A call money account (Tagesgeldkonto) is an attractive alternative to a checking account, especially for savers. This is because savers can deposit any amount of money daily at the current call money interest rate and have unrestricted access to the account. It is well-suited for saving because it has no clearing facility. This means that transfers and direct debits to other accounts are not possible. Sounds attractive? It is, but there are still a few tips to keep in mind.
1. Pay attention to the interest rate guarantee
Since the interest on a call money account is a variable rate, it is subject to market fluctuations. It is therefore advisable to fix interest rates for a certain period in advance. It is always worth comparing different providers, who offer differently attractive interest rates and conditions.
2. Don't fall for bait offers
Many banks promise new customers an extremely high interest rate. Usually, this is just to attract new customers, so the high interest rates are lowered again after a short time. There are also banks that only promise high interest rates if you open a checking account at the same time.
3. Find out about offline usage
Many customers might be put off by a call money account that only works via online banking. However, the online portals are usually very clear and easy to understand. Otherwise, it is worth checking whether the call money account can also be managed by phone or letter. Branch banks also offer personal service.
4. Determine the investment amount beforehand
Many interest rates are linked to the amount of the investment. Therefore, you should think about the investment amount beforehand so that the providers can recommend the best possible interest rate.
5. Watch out for hidden costs
Even if many providers claim the opposite: hidden costs such as the opening of a fee-based checking account or a securities account can also be found in the fine print of call money accounts. Pay attention to small hints so that you really save money in your household can.
6. Check interest payout in advance
Depending on the provider, interest can be paid out quarterly, annually, or monthly. More frequent crediting of interest to the investor's money increases the money faster due to compound interest: the balance continues to earn interest, because interest is also earned on interest.
7. Check deposit protection
All banks within the Eurozone must fulfill the conditions for deposit protection. By law, there is a protection limit of 100,000 euros. However, if you want to be on the safe side, choose a bank that offers more than the statutory deposit protection.
8. Avoid tax payments
Interest amounts must be taxed with the 25 percent withholding taxplus solidarity surcharge and any church tax. To ensure that a call money account is still worth it, you should use your tax-free allowance for it. This can be distributed across several accounts.
9. Do not set terms that are too long
With rising inflation and low interest rates, it is advised not to choose long terms, as you would otherwise lose your flexibility and ability to react to better offers. However, this point is only relevant for fixed-term deposit accounts, which are often mentioned in the same breath as call money accounts.
10. Choose multiple providers
Many foreign providers offer high interest rates, but only offer deposit protection up to 100,000 euros. Therefore, it is advisable to distribute a larger amount across several providers.
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