Whether you’re looking to save for the long term or a specific event, there are various savings in France to suit. Jennie Poate Jennie Poate at Ark Capital, a company of Independent Financial Advisers specialising in wealth preservation and management, tax, financial and succession planning, reviews your options…
Banks and post office
Banks and the post office, La Poste in France, offer a range of deposit accounts that pay a fixed or variable rate of return.
A basic deposit account is available for both resident and non-residents, and is called a ‘compte à terme’. They offer variable rates and the interest is taxable. Typical rates currently are around 3-5% but bear in mind that tax on deposit rates can be as much as 30%. The headline rate can be attractive but netted down it may not sound as good.
Livret A and Livret Bleu
Other accounts have a fixed rate of return set by the government. They are offered by most banks and La Poste and the interest, although low is tax free. These accounts are great for sitting alongside your current/checking account and it’s easy to switch funds between the two. The nearest equivalent in the UK is a Cash ISA, but in France, once you have reached the limit of funds that can be held, only the interest earned can exceed that and is normally added at the end of each year. These are available to residents (not including Livret ‘Bleu’).
LEP: Livret d’Epargne Populaire
For the ‘LEP’ the maximum income threshold for an account is €19,977 for a single person, and €30,645 for a couple. It is increased by €5,334 for each additional ‘half-part’ of a household, eg child. It is designed as an extra savings tool for those on low income.
Livret Jeune
The Livret ‘Jeune’ account is for ages 12-25.
Accessible savings
All of the above accounts are accessible. Interest rates across Europe are higher than they have been for a while but inflation in France is running at 2.3% (https://www.rateinflation.com/inflation-rate/france-inflation-rate/) which will in effect mean that the accounts are generally providing a return almost equal to inflation.
As advisors, we generally recommend that funds held in accounts such as these are the cash/emergency funds portion of any overall investment portfolio. Generally, you can make an instant transfer if required and the accounts nestle against the current accounts for quick and easy access.
If you’d like to find out more or have questions about how to maximise your investments, contact Jennie Poate at: jennie@ark-wm.com to find out more and arrange a consultation.
