Overview
- The Bundesfinanzministerium sent a Frühstartrente referentenentwurf into inter‑ministerial coordination on Wednesday, proposing €10 per month per child from age six to 18 that would start with the 2020 birth cohort and be accounted from 1 January 2026.
- The draft would let parents top up the state payment up to €6,840 a year, require certified providers with an effective cost cap of about 1 percent, ban upfront distribution fees until a child turns 18, and hold funds for children without individual contracts in a Bundesbank‑run special fund.
- Mütterrente III would equalise credited child‑raising time for children born before and after 1992 by adding half a year of credit per older child and trigger a one‑off retroactive payment around 2027/2028 that the Deutsche Rentenversicherung will mostly process automatically if records are complete.
- Neither measure is law: both need cabinet agreement and Bundestag and Bundesrat approval, while the Frühstartrente draft includes cost estimates (about €198 million in 2027 rising in later years) and a planned review of uptake and budget effects by the end of 2031.
- If adopted, the changes would give many families an early capital start and raise some retirees’ pensions, but success depends on accurate DRV records, public take‑up of private contracts, and how lawmakers resolve broader pension choices under growing social‑spending pressure.