Short answer: Building society saving (Bausparen) is savings tied to a purpose, housing, and not a pension product in its own right. The Building Society Premium Act (Wohnungsbau-Prämiengesetz) requires that the saved amounts be used for housing construction without delay and directly. The minimum contribution per saving year to the same building society is 50 euros (statute, status November 2026). Whether it pays off depends on whether you actually need the money for housing later.
Building society saving has long been seen as a solid way to save, and many people starting their careers ask whether it still suits retirement. The short answer: Bausparen is mainly a tool for owning property or financing housing costs. If you want to use it only for old age, take the purpose restriction seriously and know the alternatives.
The essentials in brief
- Bausparen is tied to a purpose, namely housing construction. This follows from the Building Society Premium Act.
- The minimum contribution per saving year to the same building society is 50 euros.
- The statute requires that the money be used for housing construction without delay and directly. Some exceptions, for example on death or full incapacity for work, are named in the law.
- The statute quoted here does not give the amount of the state premium or the income limits. Check the building society and the currently valid version of the law for those figures.
- Strictly speaking, Bausparen is not a pension product. It sits alongside the statutory, occupational and private pillars.
What the law says about Bausparen
The Building Society Premium Act sets out which payments qualify for the premium at all. These include contributions to the same building society, the first acquisition of housing cooperative shares and certain savings contracts with banks or housing companies. For building society contributions, the minimum of 50 euros applies in each saving year.
The most important point for life planning is the obligation to use the money. It must serve housing. If you need the balance for another purpose, clarify the consequences with the building society first.
Does Bausparen pay off as retirement provision?
Bausparen suits you if you plan to buy property or finance housing costs in the foreseeable future. The purpose restriction makes it inflexible for pure retirement saving. If you only need the money in retirement, the restriction and the obligation to use it quickly reach their limits.
A comparison still makes sense, because building society contracts and their interest differ by provider and time. Returns and conditions are set out in the contract and in the information from the building society.
Which comparison questions to ask
| Question | Why it matters | Where to find the answer |
|---|---|---|
| For which purpose may the money be used? | The obligation to use it determines your flexibility | Statute and contract |
| How high is the minimum contribution in a saving year? | It decides whether the contract qualifies for the premium | Building society |
| Which premium applies at present? | State support depends on the version of the law in force | Statute and building society |
| How long is the money tied up? | The term decides when you can access it | Contract documents |
What about the employee savings allowance?
Besides the housing premium, some employees receive an employee savings allowance (Arbeitnehmer-Sparzulage) that can be paid through the employer. Whether and how much it applies to you depends on the Asset Formation Act (Vermögensbildungsgesetz) and on your employer. This guide does not give an amount, because the figure is not confirmed in the sources used here.
When building society saving can make sense
- You plan a flat, a house or a renovation in the coming years and want to prepare the financing.
- You want a plannable savings plan with a fixed purpose and can accept the commitment.
- You want a clearly separated housing building block alongside another form of retirement provision.
Common mistakes with building society saving
A frequent mistake is to sign a contract only because of the premium, without clarifying the purpose. The premium is one component, but not a reason on its own. It is equally problematic to use the money too early or for other purposes and to overlook the obligation to use it for housing.
Anyone signing should also check the building society sum, the allocation date and the fees. These details are in the contract and change the calculation considerably.
How to combine Bausparen with other building blocks
Bausparen often works best as a complement to retirement provision aimed at other goals. Anyone who first builds a reserve for a flat can then direct money into a form of provision whose purpose is clearer. The order depends on your time horizon and on when the flat is likely to be needed.
What can change in the terms
Interest, fees and tariffs of building society contracts can change over the years. A look at the conclusion alone is therefore not enough. Ask for the current terms regularly and check whether the contract still fits your plans. Anyone who notices changes early can react in time, for example by adjusting the savings plan.
Frequently asked questions
Can I simply use Bausparen as a pension?
No. The purpose restriction requires that the money be used for housing construction. Payment as a pension is not provided for building society contracts. If you want a pension, look at the form of retirement provision that is designed for that purpose.
What happens if I do not need the money for housing?
Talk to the building society before you cancel the contract or have it paid out. The consequences of using the money outside housing depend on the contract and on the law.
Is Bausparen safe?
Building societies are supervised, and deposits are protected within the statutory deposit guarantee scheme. Check the protection limit in your case. A return is not guaranteed.
Is Bausparen better than an Altersvorsorgedepot?
Both serve different purposes. The Altersvorsorgedepot (a state-supported pension depot) is designed for old-age provision, Bausparen for housing. A comparison only makes sense once you know what you need the money for.
What to do next
- Clarify whether you want to live in or buy property in the next few years.
- Ask the building society to state the minimum contribution, the term and the current premium in writing.
- Compare Bausparen with other forms of provision, such as the Altersvorsorgedepot.
- Decide only once you understand the purpose, the term and the obligation to use the money.
Related guides
- Altersvorsorge 2027: The overview of depot, Frühstart-Rente and Riester
- Altersvorsorgedepot: From which income does it pay off?
- Three-pillar model of retirement provision
- Private pension insurance for starters
- Retirement provision for students (in German)
Sources: Building Society Premium Act, section 2 (status November 2026), German Pension Insurance, The three pillars of retirement provision
Last updated: November 2026. This guide is general information, not individual advice.
