Personal Finance

choose the right funds in euros

In 2020 then 2021, certain contracts will still yield between 1 and 2.5% net of social taxes. Follow our advice to find these rare pearls.

At first glance, life insurance is a bad one to two year plan. And for good reason, after 1.15% net of social taxes in 2019, the secure euro funds will probably land around 0.80% this year. After deduction of costs and taxes, you will even go below the level of the booklet A (0.50%). Not so fast! Beware of averages: in 2020 then 2021, some contracts will still yield between 1 and 2.5% net of social taxes. All without limit of payment. Follow the guide to find these rare pearls.

Target contracts that returned at least 1.50% in 2019

To avoid burning your cash, it will be imperative to place it on the fund in euros, which guarantees the capital invested net of entry fees. Fine, but how do you choose the right horse? Your goal: to beat inflation (1.5% in January). So aim for more than 1% net of social security contributions. To do this, target the contracts that reported at least 1.50% net of fees in 2019 (1.25% after social taxes). It’s your bottom value, knowing that you will find funds in euros having delivered up to 3% net. This range will leave you the choice between a good forty contracts.

A second sorting must take place on the one hand in view of the entry fees (see below), on the other hand, the conditions of access to the fund in euros, this point being essential not to be lulled by ‘illusions. The majority of profitable euro funds are today subject to payment conditions in risky compartments (units of account in jargon) in parallel, or even to ceilings and / or penalties.
Example with the numerous contracts on the Internet in the hands of the Spirica company: the Euro Allocation Long Term 2 fund in euros brought in 2.40% net in 2019… but it is accessible up to 50% of the payment and capped at 25,000 euros per contract. Not suitable, therefore, except to mix a short-term investment in the euro fund with a longer savings on account units. Otherwise, flush out the rare quality contracts allowing 100% payment on the fund in euros.

Payment fees: pay no more than 1%

The majority of contracts contain payment fees: 3% on average. What deter any short-term investment! Fortunately, some life insurance policies show 0% at entry. In this field, the prize goes to online contracts. This is an obvious asset, but a problem, their most attractive euro funds are subject to parallel risk taking (30 to 50% of the payment going to risky funds). Do not hesitate to knock on the doors of certain mutuals or associations of savers in particular, which display moderate and / or declining fees depending on the amounts deposited. What reshuffle the cards, because a load of 0.5 or 1% is acceptable if savings earn between 1.25 and 2.5% in 2020, 2021, or even 2022.

Also note that the fees on payments, unlike those called management, are negotiable with your advisor. Do not wait for any gesture for a 100% euro payment, the trend is even increasing. Conversely, a little risky funds will often win the jackpot. Thus, the MIF cancels the 2% entry fee to the fund in euros for which puts at least 30% on units of account. And GMF lowered them to 0.5% in March for which placed 20% at risk when the contract opened. Insurers use this argument to attract you, take advantage of it wisely!

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