On February 1, the LEP rate will take a big leap forward, from 1% to 2.20% net. However, of the 15 million eligible French households, only 7 million have one. Here’s how to find out if you’re eligible too.
So far, it was simple: the rate of the People’s Savings Booklet (LEP) was based on that of the Booklet A increased by 0.5 points. A performance bonus linked to a feature of this rulebook: LEP is not universal, but accessible subject to means testing and therefore aimed at middle-income or low-income households.
However, for the first time from February 1, the LEP will distance itself from the Livret A. While the latter’s remuneration should increase by 0.30 points, from 0.50 to 0.80%, that of LEP should more than double, from 1% to 2.20%. An exceptional remuneration for a product which has the same advantages as the Livret A: permanent availability of funds, capital guarantee by the State and tax-exempt interest.
Livret A, LEP, PEL… What is the best regulated savings product for you?
The reason is simple. Since June 2018 and a reform of the method of setting regulated savings rates, the executive has decided to entrust the LEP with the bulwark against rising prices formerly assigned to the Livret A. Clearly, its rate can no longer be set, at the time of its revision, at a level below the average inflation rate excluding tobacco over the last 6 months. Or, precisely, 2.20% for the second half of 2022.
15million eligible French people, 7million accounts opened
Will this unprecedented pay gap of 1.40 points with the Livret A account encourage the French to finally consider LEP? We can think so, and there is room. With outstandings of 39.1 billion euros in November 2021 (1), in almost uninterrupted decline since 2008, it is now the poor relation of regulated savings, very far from the Livret A (326.4 billion at the end of 2020) and even from the LDDS (121.5 billion). Admittedly, the LEP payment ceiling is limited to 7,700 euros, against 22,950 euros for the Livret A or 12,000 euros for the LDDS. Admittedly, its access is not universal. But this does not explain everything.
According to the Banque de France, in the 2020 report of its Regulated Savings Observatory (OER), only 7 million French adults hold a LEP. However, from the same source, 15 million are eligible. Which means you are at least 8 million miss LEP.
How do you know if this is your case? It’s very simple: all you have to do is consult your reference tax income (RFR) in 2021, easily accessible on your tax notice, then check that it is not higher than the eligibility ceilings listed here.
| Reference tax income ceiling for holding a LEP in 2021 | ||||
|---|---|---|---|---|
| Shares of family quotient | Metropolitan France | Martinique, Guadeloupe, La Runion | Guyana | Mayotte |
| First part | 20017 | 23687 | 24763 | 37113 |
| Surcharge for the first additional half share | +5344 | + 5703 | + 6871 | + 10294 |
| Increase for the following additional half-shares | +5387 | +5387 | + 8070 | |
| Either for 2 tax shares (husband or PACS couple, single person with one child, single person with 2 children) | 30705 | 34777 | 37021 | 55477 |
Retirement : save by paying less tax. 11 contracts compared
A product little pushed by banks
How to explain this gap between the eligible and the holders? Undoubtedly by the reluctance that retail banks have historically had to offer the product. For them, he presented, in fact, a big flaw: its management was time-consuming. You had to be asked each year to produce your tax notice, then check that your RFR was in the nails. For your adviser, one more administrative task among the many that he must accomplish. In this context, you might as well push yourself towards a Livret A or an LDDS, certainly less well paid, but easier to manage.
All of that, however, should soon be a thing of the past. Because since last year, everything has come together to simplify the management of LEP. A decree of March 2021 (2) has, in fact, authorized the exchange of information, by secure electronic channel, between the bank and the tax administration. In concrete terms, this means that your bank can now, when it opens, inform you of your eligibility, then check it each year automatically, without asking you to send it your tax notice.
According to the OER’s 2020 report, this simplified procedure was to be offered by the end of 2021 by the main banking establishments. The sharp rise in the LEP rate is therefore an opportunity to check whether your bank is one of them.
LEP offered in all major networks
If you are a customer of Crdit Agricole, Crdit Mutuel, Caisse d’Epargne or, more generally, of a large retail banking network, your bank is sure to distribute the People’s Savings Account. However, the product is absent from the catalog of online banks (Boursorama, Fortuneo, etc.), mobile banks (Orange Bank, N26, etc.) and certain private banks (HSBC, Milleis Banque, etc.)
Savings accounts: the products distributed according to the banks
(1) Source: Bank of France. (2) Decree No. 2021-277 of March 12, 2021 relating to control of the holding of regulated savings products