Mannheim – At home my money is better off than at the bank. This was apparently the opinion of a 91-year-old retiree from Mannheim, who had deposited his savings of 40,000 in his apartment.


Image: Coins and bills 

But a thief got after police access to the apartment and took the full cashbox. The savings were gone. The senior is not the only one in Germany who prefers to keep his money at home rather than entrust it to a bank.

Illusion of control

“Many people want to be able to touch and see their money, and they have the illusion that they have more control,” says Bamberger Professor of Finance Andreas Oehler. “Some think:

If there is almost no interest, anyway, I can also put my money under my pillow. “And that, although it is much faster away there than on the bank.Here at the place of hiding the imagination knows no bounds in the freezer as under the pillow.

There is no interest on cash

According to the Bundesbank, anyone who hoards cash loses money in particular: escaped interest – albeit low -, the costs of a locker or possible theft. But in times of high uncertainty, many people wanted to be able to access their finances quickly – and cash was the fastest available.

During the financial crisis in October 2008, for example, demand for it had risen sharply. Especially noticeable many 500-euro notes were sought after. In the crisis year of 2009, the Bundesbank assumed that the Germans hoarded up to 65 percent of the circulating cash. How high the proportion is at present, there are no estimates. Oehler does not consider interviews to be reliable on this subject: “Who says the truth when, for example, he hides money at home for unfair reasons?”

Fear of negative interest

The Federal Association of German Banks currently sees no signs that the Germans hoard a lot of cash. But that could change from the perspective of some experts. The reason: the discussion about negative interest rates, so if bank customers have to pay penalty interest if they invest larger sums. With the deposits of the savers is because of the low interest on the capital market hardly to earn money. So far, individual banks charge negative interest rates for major customers.

“If banks actually start to introduce negative interest rates for ordinary savers, then I think it is a probable scenario that people start to withdraw their money and deposit it at home or in the locker,” says financial market expert Dorothea Schäfer from the German Institute for Economic Research (DIW) in Berlin. “That’s why I’m amazed how lightheartedly banks talk about it.”

Worry about bank instability in Germany unfounded

Those who did not prefer to leave their money to the banks at the height of the global financial crisis were probably worried about the stability of the bank, as Schäfer says. This fear has taken a back seat in Germany today. “It has been experienced that ultimately you do not have to worry.”

Economist Michael Feigl from the Institute for Financial Services in Hamburg appeals to common sense. “I always hope that people are reasonable and do not hoard large sums of money at home,” he says. After all, the burglary figures are high.

Home-based money drives investment in security

Finance expert Friedrich Heinemann of the Center for European Economic Research (ZEW) in Mannheim points out: “Bunkering at home is also expensive, you would have to invest in security and buy safes, and the insurance premium on cash at home is also there a kind of negative interest. “