‘Less than half’ of families in Germany feel positive about their finances

A new survey published by Germany's Ministry for Family Affairs assessed the mood of parents amid rising living costs. Single parents, in particular, are feeling the strain.

'Less than half' of families in Germany feel positive about their finances
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Growing concerns about inflation and the general economic situation are weighing on many families in Germany, according to an annual survey which assesses the mood among parents in the Bundesrepublik.

Only 43 percent of parents with underage children still rate their economic situation positively, according to the newest “Family Barometer” published by the Ministry for Family Affairs.

A full 45 percent said “it’s okay” (“es geht”), whereas twelve percent saw their situation as “quite bad” or “bad”.

According to the Allensbach Institute, which was responsible for the survey, the rating worsened significantly over the course of last year.

Seventy percent of parents with children under the age of 18 said in December 2022 that inflation placed a strong personal burden on them, while 47 percent felt price rises were “severely restricting” their everyday lives.

READ ALSO: Why inflation is on the rise again in Germany

Unsurprisingly among lower and middle class families, the vast majority saw themselves as “personally burdened” by inflation, which reached as high as 10 percent in 2022 and still hovers around 8.7 percent. The figure sat at 42 percent among higher earning families.

There are currently 8.24 million families with underage children in Germany, according to the Family Ministry, forty percent of which have at least one parent with a migration background.

Single parents hit the hardest

According to the survey, single parents in particular rated their financial situation critically. A full 93 percent, according to the survey, are “very concerned” about inflation.

According to the Family Barometer, the lower the household income, the greater the additional burden on families.

Low-earning single parents, for example, would have to pay more than seven percent of their household income for inflation-related price increases. 

In comparison, couples with children in the upper-income quartile have to fork out over 4.5 percent of their income in order to cover rising costs.

Hopeful about state support

The survey also showed that the population as a whole, and parents in particular, have high expectations that the German welfare state will counteract inequality and promote good starting opportunities for all children.

According to the survey, 70 percent of the population expected current family policies to reduce child poverty. 

A full 60 percent of the population as a whole support the introduction of a basic child allowance (Kindergrundsicherung), which would provide more financial support for families without the current bureaucracy involved in applying for it.

READ ALSO: More money and less bureaucracy: How Germany wants to change its child benefits system

Among parents of children under 18, the figure is as high as 75 percent.

Family Minister Lisa Paus (Greens) has said that she wants to invest, among other things, in a reliable and good childcare infrastructure and implement the Kindergrundsicherung.

With the basic child allowance, the coalition government wants to bundle benefits from the current child benefit (Kindergeld) and child supplement (Kinderzuschlag) with financial support for school trips and other activities. All benefits could be applied for in one online application. 

Paus’ plans for a basic child allowance are, however, controversial within the coalition because of its costs. It is planned that from 2024 onward, children will receive more state support, which Paus estimates will cost Germany an extra 12 million per year.


Lower class – (die) Unterschicht

Counteract – entgegenwirken

Single parents – (die) Alleinerziehende

Class trips – (die) Klassenfahrten

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How Germany wants to make it easier for families to own a home

Germany is launching a new loan programme to help families get on the property ladder. Here's what you need to know.

How Germany wants to make it easier for families to own a home

Although Germany is known as a country of renters – in 2021 more than half the population (50.5 percent) lived in rented accommodation, the highest share in the EU – many people are choosing to buy their own property. 

And the German government wants to make this move easier for families with children. 

In June, a new subsidy programme called Home Ownership for Families (Wohneigentum für Familien or WEF) is set to launch. It replaces the Baukindergeld system which saw families being able obtain a building permit or buy a property. Through that programme, families could receive a subsidy of €1,200 per child per year over 10 years.

The government said that in 2020 alone, 175,000 families took advantage of the Baukindergeld programme.

READ ALSO: Everything that changes in June 2023

What is the WEF?

At the beginning of the year, Housing and Urban Development and Building Minister Klara Geywitz (SPD) announced that a new property subsidy for families would launch in 2023. However, unlike Baukindergeld, the WEF subsidy is not a grant. Instead, families will receive a low-interest loan.

What will be subsidised?

The ‘Home Ownership for Families’ programme provides funding for the construction or initial purchase of a climate-friendly residential building. People can apply for a loan for the following costs to be subsidised in a residential unit:

  • Construction costs,
  • Costs for specialist planning, construction supervision, sustainability certification
  • Material costs for personal contributions

Families with an annual income of up to €60,000 can apply for a loan from the KfW bank. For each additional child under the age of 18 living in the household, the annual income can be €10,000 higher (so €70,000 with two children, for example).

The government is ploughing in €350 million per year into the project. Applicants can receive a maximum loan of up to €240,000.

The loan applies to new buildings or first-time purchases that meet at least the Efficiency House 40 standard, but not to existing properties. Germany does offer some grants for renovation measures in these cases. 

Reader question: How do I install a heat pump in Germany property?

Applicants must live in the properties themselves, they must be the owner and they cannot have claimed a previous Baukindergeld subsidy.

Anyone interested in the programme should wait until it has launched and all the details are on the table before going ahead with any projects. The subsidy has to be applied for before a delivery, service or purchase contract is underway. 

READ ALSO: What to know about mortgages and fees when buying property in Germany

According to the government, the home ownership subsidy is intended to provide an incentive for the “creation of energy-efficient, high-quality residential property in new buildings”.

What are the interest rate conditions for the WEF subsidy?

The exact interest rate conditions for the programme have not been announced. However, it is known that the subsidy will be granted exclusively in the form of a low-interest subsidy loan and that there will be no direct grants or repayment subsidies. The Housing Ministry is aiming for an interest rate reduction of 2 to 4 percentage points.

The initial interest rate is expected to be announced shortly before the start of the programme.

When will the WEF subsidy start?

The programme is scheduled to start on June 1st, 2023.

How many people own a home in Germany?

According to Statista figures, in 2022 just under 29 million people lived in a house they owned in Germany, 36.9 million rented, while 4.62 million lived in shared accommodation.

READ ALSO: Ask an expert: Is now a good time to buy property in Germany?