Good question. 401k does not make that much sense when the country has a proper government pension funds so it's certainly less popular than in the US or Canada. But we do have private pension funds. Especially with current gov pension situation (it doesn't really keep up with the inflation and housing crisis) it's getting more and more popular Most of the employers will automatically open it for you but you can manage where the money is invested. Sometimes they also do the matching. My employer did 50%. As self-employed you may decide to open it yourself if you want to. There are certain companies that focuses on entrepreneurs and employed. I haven't researched it properly yet. The biggest benefits of them is, like 401k, they are tax deductible. Otherwise investing would have make much more sense.
Wow this video is exactly what I needed, I’m moving from the US to the Netherlands in the months and this was something that it was on my mind the whole time, your video helped me a lot.
Thanks for this video. I'm new to investing and spent hours learning from (american) investors about index funds and the best brokers only to find out it's completely different for Europeans 😭
Thank you for the nice overview Dmitrii! Indeed, it would be nice to cover the topic of ETFs in more detail as this is the recommended approach nowadays for passive investors. By the way, which tool do you use to keep the track of your portfolio (assets allocation, performance)?
Thanks for the reply! I personally use www.getquin.com (free version is enough for me) I also have a bunch of spreadsheets but that's for tracking the whole net worth, spendings etc.
Nice! Glad to help! I definitely recommend youtube.com/@AngeloColomboFi channel, it's very good. He is in Austria but many EU investments and brokers are similar. The biggest difference are taxes.
Just a nitpick, but mic in the front is too distracting, especially when you started to read numbers. May be move it further to the side if you want to keep it in the frame
Nice! Glad it helped! I'd recommend starting investing slow, nothing aggressive, also reading a few books on the topic. I cannot recommend any specific investments (it's forbidden by Dutch law) but I can certainly recommend some books. My favorite: - The Psychology of Money - The Simple Path to Wealth - Rich Dad, Poor Dad
Great video Dmitrii! assuming investment in ETF for the long term in NL, if I understand correctly since the tax on dividend is lower than the tax on box 3, then as long as the total assests are under 57k it would be better to invest in accumulated ETF and not in distributed ?
In my opinion, accumulated ETFs are always better and with distributed it's still advisable to reinvest all the dividends. But yeah, that taxes are another reason to buy accumulated as well. And yes, as long as your assets (including cash on deposits) is lower than 57k, you don't pay anything on box 3.
Hey Dimitry, Currently I'm a computer science student in the netherlands, planning to do a masters in software engineering. I hold a dutch EU passport. What country (or countries) would you recommend me to move to if I want to become a small business owner? Like for example a SaaS business. Assuming I want lowest tax, best standard of living and cold climate (or at least not too hot). Thanks in advance.
That's two different things: starting a family and settling down, and starting a saas business. If you didn't mention a family, I'd recommend completely different options xD I actually think the Netherlands has a very nice startup climate. For the lower earnings there are almost 0 taxes here as well. When your SaaS will start earning a lot, you can figure out where to move the business or how to appropriately incorporate it. If your goal is not 100% startup, I'd recommend asking yourself where you and your family want to live and not where the taxes is lower.
Hey! I think XTB is okay-ish broker overall. But they always focused on CFDs which is extremely speculative instrument so for me it's a bit of a red flag. When there is better options available, I am not sure what're the reasons to pick them.
@dpashutskii to be honest, in terms of fees for ETFs in euros, I would say it's a very good broker. I do not invest in cfds, only looking for ETFs, and I found this a better option compared to Degiro for instance. I can be missing something ofc, and that's why I question you about this broker 😁
For me or in general? There is no guarantee results for any investments so the only way to guess based on historical performance. Historical returns for VWCE for example are 8.85% annual. I repeat, it does not guarantee those returns in the future. There is no payouts as well. It's stock ownership.
To achieve a secure retirement, aiming to save at least 15% of your income in a 401(k) is advisable. Online tools can assist in calculating the best savings strategy for you, considering factors like age and income. Consistently saving this percentage can help build your retirement fund effectively, thanks to the benefits of compound interest.
What other financial topics do you want me to cover?
Does Netherlands have something like 401k or other pension focused investment options?
Good question. 401k does not make that much sense when the country has a proper government pension funds so it's certainly less popular than in the US or Canada.
But we do have private pension funds. Especially with current gov pension situation (it doesn't really keep up with the inflation and housing crisis) it's getting more and more popular
Most of the employers will automatically open it for you but you can manage where the money is invested. Sometimes they also do the matching. My employer did 50%.
As self-employed you may decide to open it yourself if you want to. There are certain companies that focuses on entrepreneurs and employed. I haven't researched it properly yet.
The biggest benefits of them is, like 401k, they are tax deductible. Otherwise investing would have make much more sense.
What be great to explain the tax system in NL, all 3 boxes and how its calculated
Will do, thanks for the idea!
Please make a video in detail about investing in ETF’s here in the Netherlands.
Awesome bro.. i was so in need of such videos in the Netherlands
Wow this video is exactly what I needed, I’m moving from the US to the Netherlands in the months and this was something that it was on my mind the whole time, your video helped me a lot.
Wow, that's awesome. Glad it helped!
Amazing video, thysm, do you have another one where you talk about ETFs more in depth?
Thanks for this video. I'm new to investing and spent hours learning from (american) investors about index funds and the best brokers only to find out it's completely different for Europeans 😭
Yeah, I've been there ;)
Great video, thanks for sharing it, mate!
Thank you for watching!
ETF for sure is really important. Especially for UCITS ETF. Thanks
As far as I know, non-UCITS ETF is not traded in the EU.
@@dpashutskii Do you know if the UCITS are also taxable as per Box 3?
All the investments and savings are taxable on Box 3 (except your company owned stocks).
Thank you for the nice overview Dmitrii!
Indeed, it would be nice to cover the topic of ETFs in more detail as this is the recommended approach nowadays for passive investors.
By the way, which tool do you use to keep the track of your portfolio (assets allocation, performance)?
Thanks for the reply!
I personally use www.getquin.com (free version is enough for me)
I also have a bunch of spreadsheets but that's for tracking the whole net worth, spendings etc.
Thanks! I'm a bit late and just starting to invest, so real life examples are very useful and motivating.
Nice! Glad to help! I definitely recommend youtube.com/@AngeloColomboFi channel, it's very good.
He is in Austria but many EU investments and brokers are similar. The biggest difference are taxes.
Hello, I'm new here. I'm enjoying the video.
Thanks for coming!
Pls make a video on ETF
Already cooking! Will be uploaded in a few weeks :)
Just a nitpick, but mic in the front is too distracting, especially when you started to read numbers. May be move it further to the side if you want to keep it in the frame
Yeah, totally! Thanks for the confirmation. When I was editing, I also thought of that. I won't set it this way next time.
This is exactly what I have been looking for. Thanks Dmtrii. What would you advise for a complete newbie?
Nice! Glad it helped!
I'd recommend starting investing slow, nothing aggressive, also reading a few books on the topic.
I cannot recommend any specific investments (it's forbidden by Dutch law) but I can certainly recommend some books.
My favorite:
- The Psychology of Money
- The Simple Path to Wealth
- Rich Dad, Poor Dad
Great video Dmitrii! assuming investment in ETF for the long term in NL, if I understand correctly since the tax on dividend is lower than the tax on box 3, then as long as the total assests are under 57k it would be better to invest in accumulated ETF and not in distributed ?
In my opinion, accumulated ETFs are always better and with distributed it's still advisable to reinvest all the dividends.
But yeah, that taxes are another reason to buy accumulated as well.
And yes, as long as your assets (including cash on deposits) is lower than 57k, you don't pay anything on box 3.
How can I invest here in Netherland?
Have you watched the video? What specific questions do you have?
Hey Dimitry,
Currently I'm a computer science student in the netherlands, planning to do a masters in software engineering.
I hold a dutch EU passport.
What country (or countries) would you recommend me to move to if I want to become a small business owner?
Like for example a SaaS business.
Assuming I want lowest tax, best standard of living and cold climate (or at least not too hot).
Thanks in advance.
Assuming I want to settle down and start a family of course,
I will start a company at some point in my career.
That's two different things: starting a family and settling down, and starting a saas business. If you didn't mention a family, I'd recommend completely different options xD
I actually think the Netherlands has a very nice startup climate. For the lower earnings there are almost 0 taxes here as well. When your SaaS will start earning a lot, you can figure out where to move the business or how to appropriately incorporate it.
If your goal is not 100% startup, I'd recommend asking yourself where you and your family want to live and not where the taxes is lower.
Hello! Thank you so much for your video, did you check the broker XTB? Any opinion?
Hey! I think XTB is okay-ish broker overall.
But they always focused on CFDs which is extremely speculative instrument so for me it's a bit of a red flag.
When there is better options available, I am not sure what're the reasons to pick them.
@dpashutskii to be honest, in terms of fees for ETFs in euros, I would say it's a very good broker. I do not invest in cfds, only looking for ETFs, and I found this a better option compared to Degiro for instance. I can be missing something ofc, and that's why I question you about this broker 😁
How much income investments like that would generate? Is it yearly payouts?
For me or in general? There is no guarantee results for any investments so the only way to guess based on historical performance.
Historical returns for VWCE for example are 8.85% annual.
I repeat, it does not guarantee those returns in the future.
There is no payouts as well. It's stock ownership.
To achieve a secure retirement, aiming to save at least 15% of your income in a 401(k) is advisable. Online tools can assist in calculating the best savings strategy for you, considering factors like age and income. Consistently saving this percentage can help build your retirement fund effectively, thanks to the benefits of compound interest.
Great Content, Dmitrii, keep up the good work !
Thanks, will do!