Most financial consultations start with a product. Somebody heard about a fund, saw an advert, got a tip from a colleague. That is roughly like calling a roofer before the foundation is poured.
A financial plan has an order, and it is not negotiable. Skip it and you build on sand.
Stage 1: the emergency fund
Before anything is invested, three to six months of expenses belong in an instant-access account. Not three to six monthly salaries but expenses. That is usually less and therefore quicker to reach.
Why first? Because without a buffer, every unexpected bill, every broken washing machine, every car repair leads to a long-term investment being liquidated at the worst possible moment. Exactly when prices are low.
The emergency fund does not need to earn a return. It needs to be available.
Stage 2: the risks that can end everything
Only then come insurances, and here too there is a ranking. What matters is not how likely a loss is but how existentially threatening it would be.
Always needed: personal liability. A personal injury claim can create lifelong payment obligations. The premium is laughably small in comparison.
Almost always needed: protecting your ability to earn. Your income finances everything else. If it disappears, everything goes with it. The state reduced-earning-capacity pension is as a rule not enough.
If people depend on you: term life insurance. Not as a savings product but as pure protection.
Depending on situation: professional liability, legal expenses, contents, natural hazards.
What almost never comes first: phone insurance, glasses insurance, travel luggage. Those are annoyances, not existential risks.
Stage 3: expensive debt
An overdraft or a consumer loan at a double-digit rate beats any realistic investment return. Paying those off first is mathematically the safest “return” there is, because it is guaranteed.
A mortgage at a low rate is a different matter and does not need to be prioritised.
Stage 4: only now, building wealth
And here too the question comes before the product: what for, and by when?
- Money needed in three years does not belong in equities.
- Money for retirement in thirty years does not belong in an instant-access account.
The real planning happens between those two poles. The time horizon determines the form of investment, not the other way round.
The 2026 reference figures
A few values that come up in almost every conversation:
- Pension level: 48 percent before tax. That applies to 45 contribution years at average earnings, not to your final salary.
- Current pension value: 42.52 euros per earnings point since 1 July 2026, up from 40.79.
- Standard pension: 1,913.40 euros gross at 45 earnings points.
- Tax-free allowance on investments: 1,000 euros per person, 2,000 jointly.
- Income threshold for private health insurance: 77,400 euros gross a year. Only above that may employees switch.
- Contribution assessment ceiling: 69,750 euros. Health contributions are charged up to that income.
These figures change every year. Planning with outdated values means planning wrongly.
- Three to six months of expenses are available in cash
- Personal liability cover exists and is current
- My ability to earn is protected, not just by the state
- I have no debt at a double-digit interest rate
- I know what I am saving for and by when, not just that I save
Only when all five ticks are there is the question about funds, ETFs or pension products the right question.
The first conversation is not about products but about where on this ladder you stand. Often the next step is smaller and cheaper than people expect.
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We go through the four stages from the bottom up and note where something is missing. Usually the next step is exactly one thing, not five.
Sometimes the outcome is that you need nothing new at all, only an adjustment to something existing. I say that too, even when there is nothing in it for me.
Common questions
How much should I save each month? There is no sensible blanket answer. The figure follows from your goal, your horizon and what remains after fixed costs. A rule of thumb like “ten percent” ignores all three.
Is it worth saving while I have debt? The emergency fund yes, alongside repayment. Long-term wealth building alongside expensive debt usually not.
Do I have to change everything at once? No, and that is rarely sensible. A financial plan is built over years, not in an afternoon.
