When you open a depot, you have to consider a lot. A custodian account can be described as an account for shares in a corporation, funds, cryptocurrencies or ETFs. To trade in securities, a custodian is always required. However, the opening is not difficult and with some providers within 5 minutes possible. What you have to consider we explain in this article and give tips for your first investment.

A custodian holds and manages the securities. Securities are, for example, stocks, bonds, funds and ETFs. Originally, the depot was managed offline and resembled a locker at a bank. Nowadays, however, this is happening digitally. Via his smartphone you can see the current courses in an app, act and receive various other information about the individual companies. You can act in the apps by a few clicks. The app is usually taken for granted, so that it is easy to use after several attempts.

Securities are proving to be significantly stronger in yield today than savings accounts, overnight money accounts and fixed money accounts. It is also practical that some providers pay interest on the money deposited. Often the payment is monthly.

However, there is a higher return of course only at a higher risk. The value of the portfolio can change significantly in a short period of time. In addition, it should be noted that the invested money is then also gone and you may have to do without it for many years. In order not to make any losses, you should not sell your securities simply because you are not raising enough money. Rather, it is important to plan your assets in the long term in order to be able to sell securities at a clever time.

Purchased shares or shares are not protected by a deposit insurance. However, they belong to the special assets and do not fall into the insolvency estate in the event of insolvency. What this looks like with cryptocurrencies we have explained in one of our other posts. If the custodian becomes insolvent, you can transfer the securities to another bank. Investors also protect investor compensation under European law. After that, a maximum of EUR 20 000 per investor is protected and a maximum of 90 percent of the missing sum.

In order to open a depository, you do not have to meet any special requirements. You must be at least 18 years old and need a checking account at a bank. Some banks also require a residence in Germany. You do not have to have a certain asset.

The existing checking account is the reference account. If you also open the deposit at the bank where you hold your checking account, this is also your account. For a broker, settlement account and reference account are usually different. The clearing account is opened automatically with the deposit. Deposits and withdrawals are only possible between the reference account and the clearing account and are not possible with the deposit account. The depository is not intended for payment transactions. Therefore, the settlement account between the custodian and the reference account is interposed.

As a rule, deposits are possible from any current account. For individual providers, only deposits are possible from an account that belongs to the user himself. Withdrawals from the depository are usually only possible to the specified reference account.

In summary, the task of the clearing account is to secure the money for the next purchase of securities and to collect income from the sale of securities and dividends.

The reference account, on the other hand, serves to deposit money into the clearing account. In addition, the money from the deposit, which you have paid yourself and want to use elsewhere, goes to the reference account.

You can open your deposit with various providers. So you can open a deposit at branch banks, online banks or at a broker. If you open a deposit at a branch bank, you can go to the local bank branch and apply for the opening there. However, branch banks are regularly expensive because of high fees for transactions and custody. This, of course, reduces the yield. There is the possibility to run the depot completely offline, which is usually cheaper.

Pure online banks are usually much cheaper. A broker is the cheapest. They only offer custodianship and do not allow further banking transactions. Account management fees do not regularly apply there. Transactions regularly cost only one euro and on unused money there is interest as with a money account. The selection of the right depot is therefore of particular importance. With the right deposit, the costs for buying and selling are reduced and the profit increases.

When you open your deposit, you don’t have to pay taxes just for opening it. Taxes only apply to capital gains, such as interest and dividends or realized profits. The tax is levied as a withholding tax and therefore withheld directly. The net amount is therefore included in the portfolio. The tax burden is 26.375 percent including solidarity surcharge. If necessary, there is also church tax. EUR 1 000 per year and EUR 2 000 in the case of spouses are tax-free. Another way to realize tax benefits is to trade with an asset management GmbH.

It is particularly important to issue an exemption order at the outset (§ 44 (1) no. 2, paragraph 2 sentence 1 no. 1 EStG). So you can prevent that the allowance of EUR 1 000 or EUR 2 000 is already taxed. There is an area in the app where you can submit the corresponding application.

Before you deposit money into your depository, you have to take into account that the deposited money is once gone. You should consider this in your wealth planning.

If you hold the clearing account and the deposit via a German bank, the balance on the clearing account is secured up to EUR 100 000 in the event of bank insolvency. German banks are members of the Deposit Protection Fund and have a German banking license.