First day at school 2026: how to invest money for a new school student

The first day of school is a truly special event. In Germany in particular, children are celebrated on this day and receive the traditional “Schultüte” (a cornet filled with treats and small presents) and a special type of school backpack known as a Schulranze. These days, grandparents, godparents, friends and family friends also often give money as a gift. 

Here are four questions to ask before you decide what to do with the money:

• Who will the money belong to?
• When will it be needed?
• What will it be spent on?
• What level of risk are you comfortable with?
• Who will the money belong to?

If you plan to invest the money in the student’s name, be aware that the money will legally belong to the child. Starting at 18 years of age, they will be able to decide what to do with it. If you don’t want that to be the case, you can invest the money in your own name and decide at a later date when to give it to the recipient.

When will the money be needed?

If you plan to use the money soon, for example to fund school excursions, a bike or a laptop, then you will want a safe investment that you can access quickly. One great example is a fixed term deposit. The interest isn’t as high as some other investment vehicles, but the money will be available and ready to withdraw when you need it. If, on the other hand, you plan to invest the money and use it to fund a driver’s license or further education for your child, there are savings and investment options that can work well.

What will the money be spent on?

If you plan to use the money for expenses while the child is in school, a simple savings solution may be enough. But if you want to invest the money for a long period of time, an investment in securities, such as shares, bonds or investment funds may be the best solution. This includes ETFs, a very popular in-vestment. A godparent that regularly saves 25 EUR a month for their godchild can use this solution to save an impressive amount over years - among other things due to compound interest. Many banks now offer investment plans for smaller amounts, for example as part of fund savings schemes.

More opportunities, more risk

As a general rule, securities offer better returns than savings accounts. However, the value of securities investments varies and may end up lower than the amount of money invested – in a worst-case scenar-io, you could end up with no money at all. That’s why this type of investment is best for money that will not be needed for many years to come. Profit is not guaranteed and upward trends of the past do not predict future values.

Three tips for anyone who wants to save money for a child

1. Pick your goal first, then choose how you will save the money.
2. Save on a regular basis instead giving a lump sum.
3. Reliability and availability become more important as the date you will need the money on draws near-er.

The most important question, therefore, is not where should I invest the money, but rather what will the money be used for? If you take the goal, time period and risk into account, you can usually find a good solution quickly. Ask your bank for advice if you still have questions about how to provide the best monetary gift for the first day of school.