The Livret d’epargne populaire will soon yield two and a half times more than its cousin the Livret A. Millions of French people are eligible but have still not asked their banker. With a rate of 4.6%, the LEP is nevertheless an unbeatable risk-free investment.
It is a savings product that is celebrating its 40th birthday this year. And despite its age, the People’s Savings Account (LEP), accessible subject to means testing, is still far from meeting the success it deserves. However, it offers an unbeatable remuneration today for a tax-free investment, of which the capital is 100% guaranteed by the State. The LEP rate, currently 2.2%, will drop to 4.6% from August 1st.
In theory, 18.6 million French people can open one with their bank. However, at the end of 2021, only 37% of eligible people held an LEP, or 6.9 million, revealed this Tuesday to the Banque de France. LEP’s retention rate, despite more attractive relative pay, is still too low, insisted its boss, Franois Villeroy de Galhau. Indeed, for households whose amount of income does not exceed certain ceilings (20,297 euros for a tax household of one person), the LEP is much more interesting than the Livret A, held today by more than 8 out of 10 French people, compared to one out of 10 for LEP . Indeed, the passbook A rate will reach 2% next month. It is therefore a remuneration 2.5 times lower than the future 4.6% of LEP, at a time when inflation should reach 5.5% over the whole year.
The LEP, the shield of purchasing power
The real product of popular savings must be the LEP, insisted Franois Villeroy de Galhau, while the rise in prices undermines the household budget. Indeed, according to article L221-13 of the Monetary and Financial Code, the popular savings account is intended to help people with the lowest incomes place their savings in conditions that maintain their purchasing power. This is no longer the case for the Livret A whose method of calculation was revised in 2018.
For the Banque de France, the message is clear: if you are entitled to it, open an LEP to protect your savings rather than leaving it on a Livret A. While the average outstanding amount on a livret A is 5,800 euros, it is possible to deposit up to 7700 euros on a LEP.
Find the lowest rate for your real estate project!
2022, the year of LEP?
Since the start of the year, the Banque de France has seen a stir. The openings of LEP are multiplying: 824000 between January and May. An influx linked to several measures: bank advisers can now question the tax authorities directly to find out if the conditions of detention are met by the holder or the person requesting the opening. Until now, households had to send their income tax notice to their bank to prove their eligibility.
In addition, the tax authorities sent an email in January to French people eligible for the LEP to present the main advantages and terms of this booklet (attractive rate, absence of social security contributions, protection by the state, etc.). .). As a result, in 2022, the number of open LEPs should no longer decrease. In 2008, 13.2million of individuals had LEP, compared to 6.9million the end of 2021.
The government has also announced that the Directorate General of Public Finances will send an email to French people eligible for LEP. The mobilization of everyone, including the banking networks, must continue, in order to open up millions more LEPs in the coming years, underlines the boss of La Banque de France.
The secrets of Booklet A