The Livret is one of the most popular savings vehicles in France. Life insurance is also a very popular investment among the French. Both supports have many advantages. But which of the two to choose to maximize your savings in 2024?
Livret A is the most popular means for French people to grow their savings safely and without being subject to tax charges. In fact, interest is exempt from income tax and social security contributions.
The interest rate for Leverate A is currently set at 3% by the state, taking into account inflation for the entire year 2024. The invested money remains available and can be withdrawn at any time in case of need, which is remote. from negligible. Additionally, there is no maximum withdrawal amount, it is enough that the account balance remains positive.
Also, the account holder can make withdrawals across all branches, making easy access to saved capital if needed. It should be noted that Livret still allows significant capital savings of up to 22,950 euros. This limit can be exceeded when interest is added to your savings.
In this regard, life insurance offers better options, as there is no savings limit. An investment appreciated by the French, life insurance proves relevant when you want to finance medium and long-term projects or prepare for your retirement and your inheritance.
Indeed, life insurance has many advantages, such as reduced taxation and transmission of capital. It also allows you to accumulate capital in the long run. After a few years, the enhanced capital can be withdrawn, with additional capital generated by the profitability of the account.
Life insurance also offers the possibility of supplementing one’s income, especially for retirement, through regular withdrawals or through capital conversion into a life annuity. Finally, it presents an excellent tool for transmitting one’s legacy, Thanks to favorable taxation and great freedom in choosing beneficiaries.
In terms of taxation, life insurance offers certain advantages. For withdrawals from the contract eight years after its opening, the flat-rate deduction amounts to 24.7% for amounts paid less than 150,000 euros. If your contract is more than eight years old you also benefit from an annual reduction of 4,600 euros (9,200 euros for a married couple) on the earnings generated.
All these advantages make the choice between the two investments difficult. For Cyril Blason, a partner at the Pair Counsel firm, “ The choice between Liverate A and life insurance depends on the age of the savers, their projects, their funds and the need or not to have immediate access to their assets.
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