The idea behind a fund is very simple: Many investors pool their money instead of investing individually. The experts of the investment company bundle the monies of the separate investors and in turn invest in different securities. For example, securities can be stocks or bonds.
The individual investors receive shares in the fund. Possible returns thereof will be distributed or reinvested. Additionally, investors can profit from increases in the share price of the fund.
The fund savings plan as retirement provision
The financial gap which we can expect after an active working life is getting bigger after a series of pension reforms. With a fund savings plan you ensure your standard of living through wise personal provision.
You can decide how long and how much you want to save. There is no minimum period and you can adjust your savings contributions to correspond to the current savings desired, at any time. You can also top up your fund savings account with one-off payments at any time.
As a fund saver, you can counteract cyclical trends, just like a stock market professional. You buy more shares when fund prices fall and less when the prices rise.
This results in a more favorable average price in a long term. Together with that, there is no significant entry point for a savings plan compared to a one-off payment.