Scalable Capital introduces children's custody accounts.

The digital asset manager Scalable Capital is adding a new product to its range: children's custody accounts. Parents can now save and invest for their children over the long term, either via the Scalable Broker or the Scalable Wealth digital asset management service. The aim is to give even the youngest children access to capital market investments and the effects of compound interest. This step was expected by experts, as other neobrokers such as Trade Republic had already launched a children's custody account on the market earlier.

Two ways to invest: decide for yourself or have it managed

Parents can choose between two options:

• In Scalable Broker, they put together the portfolio themselves, for example from ETFs, shares or funds.
• In Scalable Wealth, Scalable Capital takes over the selection, monitoring and tax optimization of the investment.

As part of the Scalable Pocket Money program, the ongoing management fees (TER) are reimbursed in over 200 ETFs, while the management fee is completely waived with Scalable Wealth. According to the company, with a monthly savings plan of 50 euros, this can make a difference of several tens of thousands of euros in your final assets over the long term.

Tax-free income and interest on balances

Another advantage: children can achieve tax-free investment income with their own securities account. The combination of the saver's allowance, basic allowance and special expenses allowance means that up to EUR 13,132 per year can be received tax-free, which corresponds to an annual tax saving of up to EUR 3,676.

At this point, however, parents need to be very sure and know what they are doing. Currently, a child is allowed to have €15,000 in assets in order to receive the full Bafög rate. If in doubt, you should seek advice to avoid any nasty surprises later on.

In addition, children's custody accounts with the broker benefit from 2% variable interest on PRIME+ balances (unlimited) and on FREE balances up to €100,000, based on the current ECB deposit rate.

Benefit from the compound interest effect early on

Scalable Capital emphasizes long-term wealth accumulation as the central goal of the new offer. Assuming an annual return of 7.7%, corresponding to the historical average of the MSCI World, monthly deposits of 50 euros from birth until the age of majority could yield around 23,000 euros, and even over 890,000 euros by the time you retire.

Private provision is no longer a luxury, but a necessity. With the children's custody accounts, we enable families to enter the capital market early and free of charge - simply, automatically and tax-optimized.

Erik Podzuweit, founder and Co-CEO of Scalable Capital

Easy entry and legal security

A children's custody account can be opened completely digitally in just a few minutes. Once created, deposits can be made immediately via real-time transfer and savings plans. The custody account legally belongs to the child, but is managed by the parents until the child reaches the age of majority. After that, the disposal is transferred automatically.

Scalable Capital also welcomes the planned introduction of the state early-start pension from 2026, which is intended to support children with 10 euros per month when they start investing. At the same time, Scalable wants to expand its own financial education offerings for parents and young people in order to raise awareness of private provision and sustainable asset accumulation in the long term.

Children's custody accounts with real investment and tax options could become an important building block in promoting private pension provision in Germany at an early stage and a first step towards anchoring capital market skills across generations.