Many people dream of a worry-free retirement, but the statutory pension is often not enough. If you want to remain financially independent, you have to make provisions yourself.
Many people dream of enjoying retirement as a time of freedom – with travel, family and more leisure. But the reality is often different: in many cases, the statutory pension is not enough to maintain the usual standard of living. According to the German Pension Insurance, the average old-age pension is around 1,348 euros for men and 908 euros for women*. Given the rising cost of living, it is clear: If you want to remain financially independent, you have to take action yourself.
ETFs as a simple solution for pension provision
One option for private provision is investing in ETFs (Exchange Traded Funds). They are cost-effective, transparent and enable a wide distribution of capital, even with small monthly amounts. In this way, investors benefit in the long term from the development of the global economy. But a common mistake: Many people rely exclusively on the MSCI World, which consists of almost 70 percent US companies. This leads to a one-sided orientation and wastes potential for diversification.
More opportunities through emerging markets
Anyone who thinks outside the box discovers new opportunities: emerging market ETFs reflect the growth of young, dynamic economies. These countries have long been more than just production locations – they are drivers of innovation with a growing middle class and stand out through progressive ones Digitalization out.
The Franklin FTSE Emerging Markets UCITS ETF (ISIN: IE0004I037N4) represents the largest and most important emerging countries, from Asia to Latin America to Eastern Europe. On the other hand, it is more focused Franklin FTSE China UCITS ETF (ISIN: IE00BHZRR147)in which technology, finance and consumption are among the growth drivers. Or that one Franklin FTSE India UCITS ETF (ISIN: IE00BHZRQZ17)giving you access to one of the youngest and most dynamic economies in the world.
Active stock ETF: dynamism meets tradition
At the end of November, Franklin Templeton rang the bell on the Frankfurt Stock Exchange. With the celebratory “Bell Ringing Ceremony”, the asset manager is celebrating the launch of its first actively managed equity ETF for European investors. The event is more than just a symbolic moment: it represents the next step in the company’s development as a versatile ETF provider. Actively managed ETFs are becoming increasingly important. They combine the advantages of passive ETFs with the expertise of experienced fund managers. “Active ETFs play […] a central role: They enable investors to implement active strategies with the same efficiency, transparency and flexibility in trading that they are used to from traditional ETFs,” explains Martin Bechtloff, Vice President ETF Distribution at Franklin Templeton. The advantage: Fund managers can react in market phases in which a rigid index reaches its limits and specifically select companies that offer particular growth potential or, conversely, reduce risks. An example of such an active ETF is the newly launched ETF Franklin ClearBridge US Smaller Companies UCITS ETF (ISIN: IE000XJA2OU4). This invests in high-growth US small and mid-caps, i.e. in companies that are still at the beginning of their success stories but have the potential to become the market leaders of tomorrow.
With the ringing of the bell, Franklin Templeton marked the launch of his first actively managed stock ETF.
Photo: martinjoppen.de
Time is the most important factor
The biggest hurdle is often not a lack of money, but rather hesitation. Even small monthly amounts can create a solid cushion over the years thanks to the compound interest effect. The key is to start early and stick with it regularly – whether with broad index funds, active strategies or emerging market ETFs.
*Source: German pension insurance.
Important legal information:
This material is for general information purposes only and should not be construed as individual investment advice or as a recommendation or solicitation to purchase, sell or hold any securities or to adopt any investment strategy. It does not constitute legal or tax advice. The comments, opinions and analyzes are current at the time of publication and are subject to change without notice. The underlying assumptions and these views may change due to market and other conditions and may differ from those of other portfolio managers or the Company as a whole. The information contained in this material does not constitute a complete analysis of all material facts regarding any country, region or market. There is no guarantee that any forecast, forecast or projection regarding the economy, the stock market, the bond market or the economic trends of the markets will come to pass. The value of investments and the income from them can go down as well as up and you may not get back the full amount you invest. Past performance is not necessarily an indicator of future performance and is not a guarantee. All investments involve risk.