The Livret A rate went from 0.5 to 1% at the start of the year. An increase that makes the precautionary savings account a good alternative for making your money grow. Indeed, several funds in euros yield much less, especially if we take into account the tax system.
It’s time to take stock of the 2021 life insurance rate season. The vintage of the funds in euros was announced like a bad year. And that was the case for several of them. They were outdated by the increase in the Livret A rate on February 1, which has doubled to rise today 1% net of tax. Dozens of contracts are well below this symbolic bar according to the classification made by the firm GoodValueForMoney.eu (GVfM). Back to the biggest flops of funds in euros.
Intensive Horizondistributed by wealth management advisors and managed by Apicil Lifeshows a return of 0.5% (1) for its Apicil Euro Select fund. Apicil is thus one of the poor students for the 2021 yields of secure media, just like the previous year.
The Savings Bank is also at the top of the 2021 euro fund flops basket. Its old Initiatives Plus and Transmission, Yoga, Akido and Ricochet contracts grant a rate of 0.5%, unchanged from 2020. Just like the Nuances Scurit Fund managed by CNP Assurances for the Nuances 3D and Nuances Grenadine policies. His Millevie Essentielle contract managed by BPCE Vie announces a return of 0.75%.
At Credit Agricole, the remuneration of the Predissime 9 series 2 contract is also found in this ranking. Its Euro Predica fund remains at 0.65%, equal to the 2020 rate.
The postal bank displays a rate of 0.65% on the fund in euros of the contracts of the range Vivaccio insured by CNP Assurances.
To the People’s Bank, the fund in euros for consumer policies Horizo and Horizo 2, managed by BPCE Vie, are at the bottom of the ranking. 2021 performance drops 0.75 from 0.80% in 2020. However, the compensation may be increased, under certain conditions. This bonus is in fact reserved for the largest savers thanks to a discount on management fees from 15,000 euros and access to a more advantageous rate from 120,000 euros.
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Boursorama Life, ING Direct Life and Monabanq Life Premium: all these life insurance contracts have one thing in common, Generali’s Eurossima euro fund dedicated to life insurance contracts distributed on the internet. It also displays a rate lower than that of the Livret A to amount to only 0.75%.
The Vivpargne range of AG2R La Mondiale recorded a return of 0.76% in 2021 for its euro fund. The remuneration was still 1% in 2020. The Terre de Vie contract backed by the general assets amounts to 0.86% and rises to 1.50% for customers who have taken up to 60% of units of account.
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On the Socit Generale side, the range Essential Maple shows a base rate of 0.75% (bonus up to 1.76%). For his contract Squoiathe base rate is the same but the bonus goes up to 1.84%.
The contract Navig’Options of Crdit Mutuel Arka announces a rate for the fund in euros Suravenir of 0.85% for free management and 1.2% for delegated management.
What is your euro fund made of?
Funds in euros are made up more than 80% bonds, in other words debt securities. This category of financial assets, low in profitability and low in risk, generates regular income thanks to coupons, the equivalent of investment interest. Insurers can thus guarantee to savers that they will not suffer a heavy capital loss via the fund in euros.
Taxation on the returns of funds in euros
But beware, to see if the fund in euros is more efficient than the remuneration of the Livret A, it is also necessary to integrate the tax. Expressed net of management fees on your annual statement, the return of a euro fund is not net of tax. On all contracts, annual interest is immediately deducted from social security contributions (17.20%). An announced return of 1% for 2021 therefore brings you a little less than 0.83%. It’s also worth remembering that, depending on the amount and date of your withdrawals, your earnings may be partially subject to income tax.
Some contracts which posted a net return above 1% are therefore ultimately, once the social contributions have been deducted, below the rate for the Livret A account. This is the case, for example, of BNP Paribas and its base rate of 1 .10% for contracts Multi-investments, Multi-investments Privilge and Cardif Elite. Excluding bonuses, once social security contributions have been deducted, the rate of its BNP Paribas Cardiff euro fund rises 0.91%.
If you have taken out one of these contracts, it may be in your interest to request a transfer to another more interesting one offered by your insurer. Or else, open another contract with better returns and lower fees.
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(1) All returns are net of management fees, but before social and tax deductions.