According to the magic triangle, the first goal that is sought when investing money is sufficient liquidity. Above all, it is important for investors to be able to access means of payment quickly and easily in order to be able to meet any payment obligations immediately.
Therefore, Stiftung Warentest recommends in its advisory financial magazine “Finanztest” always to keep two to three monthly salaries in the account as a reserve. Even if the interest rates for overnight money accounts in Germany are currently very unattractive for investments and are close to zero, this investment method gives customers the option of accessing their stored money at any time. Because according to Stiftung Warentest, for example, forced access to the overdraft facility of the current account should be avoided if there is a lack of liquidity due to the significantly higher debit interest.
The annual Gothaer study on the investment behavior of Germans shows, however, that when it comes to investing, people in Germany focus on a different approach. In the random survey of 1,001 German citizens in January 2020, 52 percent of those questioned stated security as the most important goal when investing. The corner point “security” of the magic triangle is primarily to be understood as the preservation of assets. Therefore: German investors absolutely want to avoid that the money invested in the account becomes less in real terms. To prevent this from happening, customers are willing to neglect another corner of the triangle, profitability.
Because according to the consumer center Saxony, higher security leads to lower yields; the goals of security and profitability therefore compete in investment. With luck, according to the consumer advice center, Germans can just manage to compensate for inflation at the current interest rate levels and thus maintain the purchasing power of money, but in no way increase it. According to expert assessments, examples of secure investment options are fixed-income investments, such as bank savings plans or time deposit accounts.
According to the results of the Gothaer study, German investors consider high returns on their investments to be the least important criterion. For only ten percent of those surveyed, profitability is the most important factor when making investment decisions. Nevertheless, Karin Baur, an expert at “Finanztest”, advises in an interview published by Stiftung Warentest on the courage to return: “Nobody should take more risks than they can or want. But if an investor wants a higher rate of interest than the current secure rate, then he stays with him nothing else than to mix in risky investments, “explains the expert to Stiftung Warentest. For this purpose, Baur recommends shares in the form of broadly diversified equity funds.
“We always recommend mixing different types of investment when investing. If you have only invested interest, you could spice up your savings with a small portion of equity funds, for example,” advises the expert in the interview. Her colleague and financial expert Michael Beumer also supports the advice and recommends using riskier investments as an additive. According to Baur and Beumer, stocks or ETF fund savings plans are particularly suitable for this.
Other investment decision-making factors
Nevertheless, according to industrial engineer Markus Scholand, Germans’ investment decisions are not limited to these three goals: “Many people do not just make investments based on returns, risk and liquidity,” the financial expert explains in an interview with Stiftung Warentest. According to Scholand, “the location of branches, the type of advice given, the distribution channel, gender, social status‘ or current issues in the media “are also decisive factors when investing money. According to the expert, even the availability of parking spaces can play a role in customers’ investment decisions.
Pauline Breitner / Forex-news.com.net editors
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