The Riester reform 2027 (Riester-Reform) replaces the Riester pension (Riester-Rente) from 2027. A new, state-subsidised model with several product variants takes its place. For students and young professionals, the key questions are how the allowances change, what happens to existing contracts and which new products are available.
Short answer: From 2027, the Riester reform replaces the Riester pension with new products, including the pension depot (Altersvorsorgedepot). According to German Pension Insurance (DRV, status October 2026), the basic allowance will be up to 540 euros a year and the child allowance up to 300 euros per child. Existing Riester contracts continue with acquired rights protection.
The key points
- From 2027, the Riester pension is replaced by a new, state-subsidised model. The DRV gives the start as 2027, for self-employed people from January 2027.
- According to this description, the basic allowance is capped at 540 euros a year. The child allowance is up to 300 euros per child and year.
- Existing Riester contracts continue. A switch to the new subsidy is possible by declaration.
- New products include options without guarantees (pension depot), products with a guarantee and a standard depot with a cost cap of at most 1.0 percent.
- Whether you benefit depends on your own contribution, your status in statutory pension insurance (gesetzliche Rentenversicherung) and the costs of the contract.
What changes for the Riester pension from 2027?
According to the DRV, the Bundesrat passed the law on 8 May 2026. Until now, the state subsidises a Riester contract with 4 percent of the prior year’s pension-insurable income, up to an own contribution of 2,100 euros. The subsidy was therefore at most 175 euros a year.
The new system is based on your own contribution. The basic allowance is 50 cents per euro you pay in, up to an own contribution of 360 euros. Above that, there is 25 cents per euro up to an own contribution of 1,440 euros. The basic allowance is therefore at most 540 euros a year.
The DRV description does not fully clarify how the calculation works above 360 euros. Have the exact calculation for your case confirmed by the Central Allowance Office (Zentrale Zulagenstelle für Altersvermögen, ZfA) or your provider before you decide.
| Feature | Riester until 2026 | Subsidy from 2027 |
|---|---|---|
| Basic subsidy | 4 percent of prior year income, up to a 2,100 euro own contribution | 50 cents per euro up to 360 euros own contribution, then 25 cents per euro up to 1,440 euros |
| Maximum basic allowance per year | 175 euros | 540 euros |
| Child allowance per child and year | 185 euros (born until 2007) or 300 euros (born 2008 or later) | 1 euro per euro paid in, up to 300 euros |
| Product form | Riester pension with lifelong payout | Pension depot, guarantee product and time-limited payout plans |
Source: German Pension Insurance (Deutsche Rentenversicherung), page on the pension reform, last updated 17 September 2026.
How high is the allowance? A worked example
Assumption: you pay 360 euros a year into a new contract. Under the DRV scheme, the basic allowance is 50 percent of 360 euros, which is 180 euros. Together that makes 540 euros, before costs and returns.
Assumption: for a child you are entitled to the child allowance for, you pay in 300 euros. The child allowance is then 300 euros a year. Allowances are a subsidy, not a guarantee of a particular pension. What you finally receive depends on costs and on how the contract develops.
What does the reform mean for students and young professionals?
The allowances require that you belong to the group of eligible persons. Under current law, this includes people who are compulsorily insured in statutory pension insurance. For students, the pension insurance status is therefore decisive, not the job itself. Background is given in our overview of the student job 20-hour rule, pension and semester breaks.
Working students with up to 20 hours a week remain exempt from health, long-term care and unemployment insurance, but they are compulsorily insured in statutory pension insurance. Young professionals who take up a job subject to pension insurance generally belong to the eligible group. From 2027, the DRV also names self-employed people with trade or self-employment income and compulsory members of professional pension schemes, for example members of the doctors’ pension scheme (Ärzteversorgung).
What happens to existing Riester contracts?
- Existing contracts continue. Acquired rights protection (Bestandsschutz) applies.
- You can switch to the new subsidy by declaration.
- A switch to a new contract is possible. You do not have to repay the subsidy you received, but legally capped switching, setup or distribution costs may apply.
- If you also take out a new contract, the new rules apply automatically to your existing Riester contract, according to the DRV.
Who suits the new products, and who should be cautious?
A comparison is worthwhile because the products work very differently. The DRV names these variants:
- Pension depot without guarantees: higher return opportunities, but also higher risk. It suits you better if you can live with fluctuations over many years.
- Standard depot: effective costs are capped at 1.0 percent. The DRV intends it for people who cannot decide between the options.
- Guarantee product: at the end of the saving phase, 80 or 100 percent of the contributions including allowances are available. It suits you better if planning security matters more than growth.
- Time-limited payout plans: payouts over 20 years from age 65, with the money used up by age 85. A lifelong pension is not part of this option.
A product with risk is less suitable if you need the money at short notice or cannot absorb losses shortly before retirement. A guarantee product offers less room for growth. Which weighting fits you depends on your life situation.
Where can you get reliable information?
According to its own information, the DRV offers an intensive consultation on retirement provision. Consumer advice centres (Verbraucherzentralen) advise on retirement provision, but for a fee. The ZfA answers questions on allowances and subsidy rules. If you want a personal assessment of your situation, you can also seek advice from Academycon. Our approach is described on our page on how we work.
Frequently asked questions
Can I still take out a classic Riester contract from 2027?
According to the DRV, the Riester pension is replaced by the new model from 2027. Ask the DRV or your provider which transitional rules apply to new contracts in your case before you sign.
Do I get an allowance if I work alongside my studies?
That depends on your pension insurance status, not on the job alone. If you are compulsorily insured in statutory pension insurance, you can generally belong to the eligible group. If you opt out of pension insurance for a mini-job, you are generally not compulsorily insured there. The DRV can clarify your case.
Is the pension depot the same as a savings plan?
No. The pension depot is a depot in which you hold investments on the capital market. In the variant without a guarantee, the value can fluctuate. A savings plan can be part of it but does not have to be. Costs and the chosen variant are decisive.
Is it worth switching out of an existing Riester contract?
This cannot be answered in general terms. Check costs, guarantees, remaining term and the subsidy you have received so far. A switch to the new subsidy by declaration is possible. A switch to a new contract can trigger capped costs. Ask for these costs in writing.
What is the deadline for deciding?
The sources we reviewed do not name a clear deadline for switching. Ask your provider or the DRV before letting any deadline pass.
What to do next
- Check whether you have a Riester contract, and ask for contributions, allowances and costs of recent years in writing.
- Clarify with the DRV or the ZfA whether you belong to the eligible group and which rules apply to you.
- Compare new products by costs, guarantee and form of payout. The standard depot with its 1.0 percent cap on effective costs is a useful benchmark.
- Have the differences explained to you before you switch or sign a new contract, and keep an eye on ongoing costs.
Related guides
- Student Job 20-Hour Rule, Pension and Semester Breaks
- Pension insurance during studies: compulsory insurance, exemption and pension points (in German)
- Building assets during your studies: starting with small amounts (in German)
- Starting your career after university (in German)
- Part-Time Jobs and Taxes for Students in Germany
Sources: German Pension Insurance: pension reform (status 17 September 2026, in German) and joint circular on the insurance status of students and interns (2016 version, check the current version, in German).
Last updated: October 2026. This guide is general information, not individual advice.
