The fund savings plan is a form of savings plan, i.e. a form of pre-planned investment. In detail, the fund savings plan consists of a method for subscribing to a share of an mutual fund issued by banks or capital management companies (CMCs).
The saver who takes out a fund savings plan regularly pays in an amount which is used for the continuous purchase of units in an investment fund and corresponds to a UCITS “Undertaking for Collective Investment in Transferable Securities”. It’s a form of savings that was developed primarily for private investors who can’t set aside large amounts of capital but are willing to gradually invest in a mutual fund. As with every fund, the fund savings plan has certain costs, such as the fund’s asset-based and management fees, and the investor is remunerated on the basis of the return on investment (interest or coupons).
There are several advantages to taking out a fund savings plan, in particular:
However, based on the risk profile, the basis of financial instruments invested in varies significantly. It can be a bond fund for a low risk profile, or a mixed fund or an equity fund if you prefer a higher risk.
As we have seen, there are certainly good reasons to opt for a fund savings plan, but it’s also important to highlight two aspects when entering into a fund savings plan:
In this article, we mentioned other topics that you may find useful to explore:
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