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Investors are wrongly investing

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Investors are wrongly investing. The low-interest-rate policy of the European Central Bank (ECB) should help the economy on the jumps. However, it also caters for investors who haphazardly tend towards high-risk investments, as the classic investment models no longer generate sufficient returns for retirement provision.

With its sustained low-interest-rate policy, the ECB has so far achieved little success on the part of a reviving economy and rising inflation. Instead, however, it is causing confusion among German investors. The once important building blocks of private old-age provision have already fallen victim to the low-interest rates. Anyone who takes out endowment insurance today has to live with guaranteed interest rates that do not even compensate for the loss of inflation. The situation is little different with secure bank deposits such as overnight or fixed-term deposits.

Investors are wrongly investing

Private retirement provision is indispensable

The statutory pension systems are confronted with a demographic problem; the increasing number of pension recipients are facing fewer and fewer depositors. The state tries to compensate, but most pensioners will barely be able to survive on their earnings. For this reason, you have also been encouraged by this website to build up a private pension plan. Since consumers showed a certain need for security, many have decided to take out endowment insurance. The ECB’s low-interest-rate policy has made this actually sensible approach ad absurdum.

Private retirement provision is indispensable

The statutory pension systems are confronted with a demographic problem; the increasing number of pension recipients are facing fewer and fewer depositors. The state tries to compensate, but most pensioners will barely be able to survive on their earnings. For this reason, you have also been encouraged by this website to build up a private pension plan. Since consumers showed a certain need for security, many have decided to take out endowment insurance. The ECB’s low-interest-rate policy has made this actually sensible approach ad absurdum.

The ECB is sticking to its course

The central bank’s QE program (provide ample liquidity) will continue until at least 2017, and the low-interest rates will not change for the time being. That may have political consequences in the EU.


As an investor, however, the low-interest rate policy poses unavoidable challenges. Of course, you would like to continue building up your retirement provision, but you must not allow yourself to be travelled to investments where your common sense says: not like this.

Emotions out of place

Many consumers are encouraged to make very risky investments by the low-interest rate policy of the ECB and thus suffer shipwreck. However, this can be avoided if you follow a few basic rules:

  • -Get independent advice before investing.
  • -Spread your capital across as many asset classes as possible.
  • -Invest for the long term and stay disciplined with your strategy.

If you take these points into account, you will have little effect on the ongoing low-interest-rate policy, on the contrary. Long-term equity investments with expert assistance give you more returns than endowment insurance in its prime.

Investors are wrongly investing

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