FAQ - Frequently Asked Questions and Beliefs

I studied business administration in Augsburg, London and the US and have an MBA from INSEAD (Singapore & France), one of the best business schools in Europe.

I have been working in the finance industry for over 20 years , including 15 years in private equity in the Middle East, including as investment manager for the sovereign wealth fund of Oman. 

I bought my first stock when I was 14 years old and have since invested in mutual funds, ETFs, CFDs, real estate, gold, cryptocurrencies, private equity and startups. I have made any mistake in the book and learned a lot from it.

I have a passion for personal finance and have read and listened to hundreds of books, articles, blogs, and podcasts.

From this I have developed an investment strategy that is based on proven scientific methods and systematically avoids all typical investment mistakes (market timing, emotional and frequent trading, overconfidence, lack of diversification, home country bias, and many more). Of course, I also use these principles for my own investments.

You can directly benefit from these decades of experience and avoid costly mistakes.

In addition, I have been an expat myself for 15+ years and lived in 8 countries, and have therefore a good understanding of characteristics and challenges of the financial life of an expat.

At the same time, I have a good knowledge of the German financial products and Government pension savings schemes.

Complete lack of conflicts of interest as a fiduciary. I cannot stress enough how important this is. In 99% of financial advice in Germany, you are sitting in front of a salesperson who only earns money when he sells you a product. Even if he calls himself 'independent' or can 'select the best product from a range of different providers for you'. 

It is not possible to get honest advice in your own interest in this way. Would you go to a tax advisor who is paid by the tax authorities? Or to a lawyer who receives money from the counter-party? In financial advice (at least in Germany), this is the standard and is not questioned.

I, on the other hand, am paid exclusively by you; as a fiduciary, I am prohibited by law from accepting commissions or other forms of payment. This is the only way to give impartial advice in the client's best interest. 

In my advice, all of the following do not exist out of principle:

• Complicated products with long, incomprehensible contracts or terms and conditions
• Small print
• Glossy advertising brochures
• 'Closing' or signatures
• Sales pressure or selling of any kind
• Time pressure
• Commissions, loads
• Hidden costs or fees
• Long-term, inflexible contracts
• Actively managed funds
• Stock tipps or recommendations
• Forecasts or predictions, especially about the future
• Guarantees

I have a passion for personal finance, and founded What.Finance? out of frustration with the poor quality of financial advice in Germany, the massive conflicts of interest, the billions of Euros lost by investors as a result of supposedly free and 'independent advice'.

I want to change that and do the right thing, and I enjoy helping others to get their finances in order and have a positive impact on their future so that through financial independence they have more time for the finer things in life.

I believe that a financial advisor can only really represent the interests of their clients if he or she works completely independently.

As soon as you work for an institution such as a bank, fund manager or financial services provider, you must always represent their interests first. This is stated in almost every employment or cooperation contract. The interest of these companies is to make money by selling (commission-generating) financial products. This interest regularly clashes with the client's interest in obtaining cost-effective, functional solutions.

I have my own mind and am not afraid to be different. I want to do things the way I think is right. Even if, for example, more than 99% of financial advisors in Germany do the opposite and sell products for commission.

In the past, I always had an issue with the conflicts of interest in the financial sector, but unfortunately I was unable to change them as an employee. Now I want to do the right thing.

• No conflicts of interest: Because I am getting paid by you directly, like your lawyer or tax advisor, I can focus my advice on you and your interests as a fiduciary. I only recommend commission-free investment solutions (efficient and index-based). This means more money stays in your pocket. There are never any markups, loads or hidden fees.
• Global diversification: My aim is to align your portfolio along the dimensions of the global investment universe so that it can withstand any crisis safely and securely. If you diversify your assets widely and intelligently, you will sleep well even in difficult market phases. Depending on my clients' risk capacity, I align the portfolio more offensively or defensively.
• Disciplined buy & hold investing: Trading back and forth empties your pockets. I protect my clients from this common fate and strive for a disciplined and long-term investment experience. A steady hand and behavioral coaching often distinguish a positive from a less positive investment experience. I consistently apply the findings from over 70 years of empirical financial market research.
• Open communication: For me, transparency and openness are core to our relationship. I provide you with clear and understandable information about all aspects of your investments. My goal is for you to always understand exactly what you are investing in and why, thus strengthening your confidence in your investment decisions.
• Long-term support: Financial planning is a process, not a one-off event. I can advise you for one time, but if you wish, I can also be your long-term partner to continually review and adapt your financial strategy. Life changes, and your financial planning should too. Whether it's about adapting to new life circumstances or taking advantage of new opportunities, I'm here for you. Wherever you are in the world.

In addition to my passion for financial independence and 'FIRE', I also interested in healthy eating, fitness, longevity, self-improvement, minimalism, stoicism, sustainability, tiny houses, sharing economy, geo-arbitrage and nomadic living, AI, FinTech, new business ideas and startups. In terms of sports, I occasionally try skiing, diving, flow riding and kitesurfing. And I almost got my private pilot's license.

German banks and insurances are not necessarily well equipped to give advice to expats, as this is not their target clientele (and their branch staff might not even speak business English well). In addition, most of their products are tailored to Germany and living long-term in the country, e.g. products with tax benefits and specified retirement age. Also, such products might not be very portable or flexible when moving to another country. And in Germany there is a culture of having and selling a lot of insurance contracts, even for retirement savings, which may not be the best investment vehicles.  

The providers that focus on expats, are mostly - as almost all advice in Germany - commission-based salespersons. It is therefore important to find an advisor registered as a fee-only fiduciary ('Honorar-Finanzanlagenberater according to §34h GewO'). At the same time, they should have an understanding of the issues and considerations an expat faces (such as wanting much more flexibility in their investment solutions), and ideally have been an expat themselves.

I have been an expat myself for 15+ years and over my lifetime

• have lived, worked and studied in 8 countries (Germany, UK, France, USA, Argentina, Singapore, United Arab Emirates, Oman),
• had bank accounts in 6 of them (plus offshore accounts) in 6 different currencies (EUR, GBP, USD, SGD, AED, OMR),
• insurance in 4,
• investments in 3,
• and was part of the pension system of 4 countries.

I have therefore a good understanding of characteristics and challenges of the financial life of an expat, while at the same time as a German having grown up and currently being based in Germany.

Among the only around 300 fee-only financial advisors in Germany, I might well be the only one with this specific combination of expertise (please do let me know if you find anyone else, as I would be very interested in connecting with them).

I can advise you fully online and flexible in any location, wether you are traveling, are currently not in Germany, and also if you move to a different country.

These are German Government savings schemes, but much less useful than established vehicles in other countries, such as 401k, IRA, etc. In addition to their often highlighted tax advantages, they come with high fees, bureaucracy, and inflexibility. 

I do not recommend them for expats, but instead advice on flexible, portable, low-cost investment structures that are much better suited for the inevitable changes in an expat's life.

Holistic financial advice as your fiduciary, without conflicts of interest, sales or commissions.

Recommendation of an investment strategy based on scientific findings with a proven long-term track record, taking into account your personal circumstances, financial situation, goals, experience and risk tolerance.

You can read a general description of my investment philosophy here.

• stocks / investment funds / ETF
• analysis of existing contracts
• investment strategy based on scientific findings
• financial planning
• brokers & brokerage accounts
• saving for retirement
• Critical assessment of strategies seen on social media (day trading, passive income, stock tips, chart analysis, etc.)
• automation of personal finance
• robo-advisors / neo-brokers
• financial education, recommendation of the best books, blogs and influencers
• typical investor mistakes & psychology
• financial independence
• financial optimization of lifestyle and expenses (place of residence, car ownership, true luxury, minimalism)
• support in implementation
• long-term support and management of investments

• tax consulting
• legal advice
• analysis of individual insurance contracts
• real estate purchase and financing
• individual stocks & stock tips
• German statutory pension
• debt counseling

1. Free initial consultation
2. Receipt of a written offer
3. You decide at your leisure whether you want to accept the offer
4. Filling out the online questionnaire
5. One or more consultations (online or in person) of approx. 2 hours each, depending on the needs and scope of the advice required
6. Receipt of a detailed consultation protocol and suitability declaration with reasons for the recommendations
7. Support with implementation, if desired

Questionnaire: 1/2 hour

Advice: from 2 hours for simple situations or questions, to multiple appointments lasting several hours for a complete analysis of existing investments and development of a long-term investment strategy to save for retirement

For the first consultation you don't need to prepare anything; this is all about you, and numbers, data and facts would be counterproductive at this stage.

For the actual consultation, you should fill out the questionnaire carefully and as completely as possible, and have documents of any existing contracts and investments available. You can also write a list of your questions, which I will be happy to answer.

There is no such thing as 'free' advice. Any advice for which you do not pay directly is financed through commissions and fees that are deducted from your investments or contributions. In many cases (especially with long-term contracts or larger investments) these add up to several thousand Euros. What is often much worse is that products sold on the basis of commissions often have a poor investment returns (e.g. very conservatively invested insurance policies or guarantee products), and this can cost you €100,000 or more in lost returns in the long term.
So you should think carefully about whether you want to rely on 'free' advice. Always remember: good advice costs money, bad advice costs a fortune.

At 99% of providers the advice is 'free' (see above).
Fee-only advisors usually charge an hourly rate comparable to that of lawyers of around €150-250 (+ VAT), or a flat fee agreed upfront which can range from around €500 to €3,000 depending on the effort involved. 

Only considering the costs of taking out a pension or life insurance policy, then fee-only advice is worthwhile starting from a monthly savings rate of €150. With a term of 35 years until retirement, the costs of a commission product with such a savings rate are normally €1,575. That is 2.5% of the total premium. With a savings rate of €300, the costs are already twice as high: €3,150. The same applies to later increases due to 'contribution dynamics'.

In contrast, you would pay €1,500 for fee-only advice, for example, regardless of the investment amount.

However, this comparison does not yet take into account the ongoing administration costs, which make up the lion's share of the costs over the entire term and, for example, in the case of ETF savings plans (an alternative concept) or good net fund policies, only amount to a fraction.

The often lower investment returns of commission products (e.g. via guarantees or very conservative life insurance policies) is also not taken into account. This difference is more difficult to calculate and can only be determined with assumptions or in hindsight, but over long periods of time can lead to €100,000 or more in lost profits. 

The initial consultation to get to know each other is always free of charge. If you then decide to have a consultation, the fee agreement will be sent by email, which you can read at your leisure and sign if you choose to accept it. You only need to pay the fee after the consultation has been completed. An advance is not necessary.

Conventional retirement products typically have a number of problems:

• High upfront costs: 9 out of 10 pension plans have costs that are too high. On average €2,000-5,000 upfront, and new costs with every contribution increase
• High ongoing admin costs: On average, 5 - 10% of each of your contributions is directly deducted - and in addition you pay further costs on the existing contract balance
• Expensive funds with poor returns: The funds are the engine of your retirement planning. If they are no good (with high loads or fees), you will not reach your goal
• Guarantees: they promise security. But the only thing that they guarantee are higher costs and lower returns
• Supplementary insurance: Combinations with other insurance (e.g. BU - 'Berufsunfähigkeit') often do not cover your needs, are inflexible and expensive
• Inappropriate products: Basic 'Rürup' pension as an employee? Riester pension as a childless person? Your contract may not fit your needs at all
• Whole life insurance can be publicly called 'legal fraud' in Germany since 40 years, but is still being sold today

All of this needs to be independently verified and possible solutions developed:

• Change funds in the plan: You can often switch to low-cost funds or ETFs or optimize the investment in other ways. This way you can achieve a higher return at lower costs - and therefore more assets in your retirement
• Separate supplementary insurance: Some contracts allow you to separate retirement provision and supplementary insurance, such as BU. This is the case for example with Allianz and Alte Leipziger. The contracts can then be optimized separately or the part that is no longer needed can be cancelled
• Reorganize your retirement savings plan: If your contract is fundamentally too expensive or its basic concept does not fit your goals, it is better to terminate it and reorganize your retirement savings plan with commission-free products such as ETFs or net policies

Many products, such as Riester pensions, whole life insurance, 'Fondspolicen', etc. are often sold based on their 'tax advantages'. In most cases they do have these, but it distracts attention from more important aspects, particularly the excessively high costs. For example, the costs of Riester contracts are sometimes higher than the tax advantages and Government subsidies. 

What really counts is the net return after taxes and costs. And that is quite low for many of these products. An advisor who earns his commission from the sale of the product will not point this out to you. A fee-only advisor who does not care whether you buy a product can and will highlight this.

The relevant question is, performed well compared to what? A 10% return of a mutual fund is pretty bad when the stock market has gone up by 15% in the same period. The figure alone, without a suitable benchmark, means nothing. As a rule, actively managed mutual funds (which are sold by all banks) on average perform worse than the market - especially after costs.

And it is important to consider that the market generates the returns, not your advisor. You don't have to be grateful for advice just because the market has performed well.

Unfortunately, it is a common misconception that funds that have performed well in the past will continue to do so in the future. Scientific research has shown that the opposite is mostly the case, due to 'reversion to the mean'. It may well be that your advisor has harmed you with such a recommendation.

In addition, with this strategy, you often end up in specialty/theme/sector funds exactly at the wrong time, when the hype is already at its peak, as seen for example in the investor inflows into the once popular 'ARKK Innovation ETF':

Sounds logical and feels reassuring, but unfortunately is not true. Nobody can reliably predict the market, not even the most competent asset manager, and so-called 'market timing', i.e. buying and selling stocks and investments to avoid losses, has been proven not to work in practice. A long-term 'buy-and-hold' approach (with lower costs) leads to a better return.

In the long run of 20 years, only 10% of fund managers are able to beat the market (and it's impossible to know in advance which ones that will be). 90% of funds performed worse than the market or were closed or merged with other funds in the meantime:

If you have made a good profit with individual stocks, statistically this is due to luck (and not any special skill or analysis). Such successes cannot be repeated consistently over the long term, also not by fund managers, so you are better advised to invest in a passively managed diversified total stock market fund.

Unfortunately, a government seal of approval does not guarantee that a product or investment scheme is useful or good. These products have been heavily influenced by the lobby interests of insurance companies and financial institutions to their advantage, and in most cases are expensive or unprofitable, or simply too small in size overall. 

1% or 1.5% per year may not sound like much at first glance. But if a fund generates an average return of 6%, this means that you are giving a quarter of all profits to the fund company. Over the entire investment period, this difference can easily add up to €10,000 or much more. Paying attention to costs is very important!

You need 25x your annual living expenses (not income) in investment assets or 'net worth'. From this point on, you can live off the income from your assets and are financially independent, i.e. no longer have a need to work.
This rule of thumb is based on the '4% rule', according to which assets can generate a long-term return of 4% after taxes, which can be withdrawn without using up the assets.

...and then you are in a position of FU: 

A savings account essentially guarantees that after inflation you will lose money in the long run, even if the actual amount doesn't change in the account.
In order to preserve the value of your money, you have to take a certain amount of risk, which is however very manageable with the right investments.

This is what is known as 'market timing', e.g. waiting for a dip to 'buy low'. Sounds good and clever, but the problem is that nobody can predict when a crash will occur. In the worst case, you will wait for years and miss out on large profits during that time. And if a crash does occur, you have to decide the right moment to buy and have the courage to potentially 'catch a falling knife' in the middle of a crisis.

Also, missing the best days in the market (the majority of which happen during a crisis) is very costly:

Mathematically, the best time to buy is right away, because statistically, on average the stock market increases 0.6% every month.

No, not only is this not necessary, but in most cases it is harmful because it leads to 'taking action' and (usually wrong) reactions. 
In many areas of life, e.g. in sports, sales or work, the person who does more, spends more hours or learns more is more successful. Unfortunately, this is generally not the case when it comes to investing. There are only very few exceptions, such as investment legend Warren Buffet. 99% of investors are better off investing passively and not being influenced by the news and experts.

A good, sensible stock investment strategy, once structured well, does not require more than half an hour of time per year. I can teach you how.

An ETF savings plan can be set up for as little as €25 a month, and is makes a lot of difference in the long term.

Unfortunately, there are some preconceived notions and misconceptions about stocks, and many people have had negative experiences with them or heard about them from others. It is true that individual stocks are risky and you can definitely 'gamble' on them. 
On the other hand, a sensible, diversified investment in the overall market, for example, can never become worthless, always recovers in the long term (even if it can sometimes take years), and has much lower volatility. A sensible investment in stocks is not like going to a casino, but a long-term solid participation as an owner in the overall economy.

"Investing should be more like watching paint dry or watching grass grow.
If you want excitement, take $800 and go to Las Vegas."
Paul Samuelson

Studies over the last 220 years have shown that stocks are the most profitable asset class in the long term. Therefore, they should almost always be part of an investment portfolio, except for short time horizons.

Unfortunately, there are always situations or market phases in which you can incur large losses by trading on the stock market. There are also a large number of mistakes that investors typically make, which then sometimes lead to them abandoning stocks as an investment. 

However, with a well-thought-out investment strategy, you can avoid almost all of the risks and mistakes and be successful in the long run, and I can show you how.

A tendency that can be found all over the world is to invest more in stocks in one's own home market because one supposedly knows them or can assess them better. This is called 'home country bias'. Unfortunately, this leads to insufficient diversification, limited to just one market or a handful of stocks, and to missing out on opportunities in international markets. An investment should be broadly positioned from a global perspective. 

A common misconception is that dividends offer passive income and are in addition to price increases, and that stocks with high dividends are therefore 'better'. In the end, dividends are only a mathematical effect and reduce the company's value on the day of the distribution accordingly. Company profits are either distributed or remain in the company as an increase in value. Dividend stocks are no better or worse than growth stocks that do not pay dividends.

At any given moment there are some current events that seem to suggest not to invest in stocks. However, nobody can predict whether, when and how strongly these will affect the stock market, and at that moment they are already reflected in the market prices anyway.
In the long run it is always good to be invested, and you should not let current events discourage you.

Such observations are certainly correct, but it is important to bear in mind that hundreds of thousands of investors, who together form the market, also have this information and make these considerations, and these are therefore already factored into the current prices. Investing in such trends would only make sense if you know more than the 'crowd intelligence' of all other investors combined.