ELTIFs in the retirement savings portfolio: Private markets in subsidised retirement provision

Whether this option is of value to you, however, depends on a key figure in the product information sheet and the redemption rules of the individual fund. Hendrik and Robin have explored this in episode #70 of our podcast Diversify . We explain how the retirement savings account works in its entirety, from the subsidy to switching from Riester, in our article Retirement savings account 2027.

ELTIFs in the retirement savings account at a glance

• Start of the retirement savings account: 1 January 2027
• ELTIFs permitted: only in the flexible retirement savings account, not in the standard account
• Limit: maximum risk rating of 5 in the key information document
• Confirmed: Federal Government's response to a parliamentary question on 22 April 2026 (Bundestag printed paper 21/5554)
• Costs: no statutory cap in the flexible account
• Subsidy: up to 540 euros basic allowance per year, regardless of the fund chosen

Can an ELTIF be included in the retirement savings account?

Yes, but only in one of the variants. The standard account is limited to two UCITS funds, i.e. classic retail funds such as ETFs, because it is intended to reach investors with little capital market experience. An ELTIF has no place there.

In the flexible retirement savings account, you select the funds yourself, and ELTIF units can be purchased here. The Federal Government expressly confirmed this in its response to a parliamentary question on 22 April 2026 (Bundestag printed paper 21/5554). For you, this means: anyone who wants to hold private markets in their subsidised retirement provision automatically opts for the flexible account.

Why ELTIFs are on the positive list

The legislator regulates which investments are permitted in the flexible account via a positive list. In addition to ETFs and other retail funds, this includes open-ended retail AIFs and ELTIFs. Individual shares, cryptocurrencies and certificates are excluded.

An ELTIF is a European fund structure for long-term investments, such as holdings in unlisted companies or infrastructure projects. With the reform ELTIF 2.0 the EU has made these funds significantly more accessible to private investors, and like any public fund, an ELTIF has a Key Information Document (KID) with a risk indicator. This is exactly where the legislator comes in. The same metric used for ETFs determines whether an ELTIF is eligible for a subsidised pension account. You can find the basics on the fund structure in our overview of ELTIFs.

Risk class 5: Which ELTIFs make the cut

The risk indicator in the Key Information Document ranges from 1 to 7 and summarises how much a fund can fluctuate and the level of risk that payments will be missed. In a subsidised pension account, the scale ends at 5. Anything rated 6 or 7 is excluded, regardless of how good the fund is.

For private equity, this is a high hurdle. The majority of private equity funds fall above the permitted class (Börsen-Zeitung, 24 June 2026), and classic buyout funds often end up in class 6 or 7.

Better prospects are offered by infrastructure and private credit. Both distribute ongoing income and are historically rated as more stable than buyout investments, which has a direct impact on the risk indicator. The ELTIF market is already heading in this direction: at the end of 2025, there was around €34 billion in ELTIFs across Europe, 55 per cent more than a year earlier. Private credit accounted for 34 per cent of this volume and infrastructure for 28 per cent, while private equity reached 22 per cent (Scope, ELTIF study from 26 March 2026).

Nevertheless, there is no blanket rule. The decisive factor remains the classification of the individual fund in the Key Information Document. You can see which infrastructure funds and private credit funds you can find at NAO on our product pages. You can invest in these funds there in a regular account, without state subsidies, as NAO does not currently offer a certified pension account.

Term and liquidity: What is different in a pension account

Money in a pension account is intended for retirement, with payouts starting at age 65 at the earliest. An ELTIF that ties up capital for years is a good match for an investor who does not intend to access the money for a long time anyway. This time horizon fits the concept of retirement provision better than a standard account from which you might want to make withdrawals at any time.

However, two aspects still deserve attention. If you change providers, your assets move with you, and the provider and fund documents will specify whether an ELTIF share is transferred or must be redeemed beforehand. Later, there is the payout phase: a withdrawal plan requires ongoing liquidity, which depends on the dates and the extent to which the fund accepts redemptions. Our article on evergreen funds.

Costs and subsidies: The long-term calculation

There is no statutory cost cap for a private pension account; the 1.0 per cent effective cost cap only applies to standard pension products. This is relevant for ELTIFs because selecting and managing unlisted assets is more complex than for an index fund, and this is reflected in the ongoing charges.

The subsidy applies to your contributions of up to €1,800 per year, while costs apply to the entire balance, year after year. After twenty years, the account balance will be many times the annual contribution, and the costs will have a correspondingly greater impact. Therefore, the total expense ratio from the Key Information Document should always be considered alongside the subsidy. We show you how to read and interpret the costs of an ELTIF in our article on ELTIF costs.

What to look for when choosing an ELTIF

The risk class determines whether an ELTIF is eligible for your portfolio. Whether it actually belongs there depends on other factors:

• Track record: How long has the manager been active in this asset class, and how have they performed during difficult market phases?
• Costs: What are the ongoing charges and potential redemption fees according to the Key Information Document (KID)?
• Redemption rules: Is there a lock-up period, and on what dates can you redeem your shares?
• Transparency: Does the fund disclose which companies or projects it invests in?
• Equal treatment: Do small investors receive the same terms as large ones?

Our investment team uses these same criteria to vet every fund; we only select 1 in 8 funds.

What does this mean for your decision?

An ELTIF in a retirement savings account is an option within a flexible portfolio, and it comes with responsibilities for you as an investor. Before you start, you can clarify the following for yourself:

• Would you like to select your funds yourself in a flexible portfolio, or is the standard portfolio sufficient for you?
• What is the risk class of the ELTIF you are interested in?
• How are redemptions regulated, and what happens to them if you switch providers?
• What are the total costs, and how do they compare to your tax relief or subsidies?

Do you have questions about how ELTIFs fit into your retirement planning? Our customer service team is available to help you personally on weekdays. Feel free to get in touch.

FAQ

Am I allowed to hold ELTIFs in the retirement savings account?

Yes, ELTIFs are permitted in flexible retirement savings accounts, provided they are classified no higher than risk class 5 in their Key Information Document. The Federal Government confirmed this on 22 April 2026.

Can I choose an ELTIF in the standard portfolio?

No, the standard portfolio is limited to two UCITS funds, such as ETFs. ELTIFs are only available in the flexible retirement savings portfolio.

What risk class is permitted for an ELTIF in the retirement savings portfolio?

An ELTIF must have a risk class of no higher than 5 on a scale of 1 to 7 in its Key Information Document (KID). Funds in class 6 or 7 are excluded.

Which ELTIFs qualify for risk class 5?

Infrastructure and private credit funds often meet this threshold because they distribute ongoing income and are valued more steadily. Many private equity funds exceed this; the classification of the individual fund is always the deciding factor.

Is there a cost cap for ELTIFs in the retirement savings portfolio?

No, there is no statutory cost cap for the flexible retirement savings portfolio. The 1.0 per cent effective cost cap only applies to the standard portfolio.

How long is my money tied up in an ELTIF?

That depends on the individual fund. You can find lock-up periods and redemption dates in the fund documentation and the Key Information Document (KID).

Do I receive a government subsidy for ELTIFs in the NAO app?

No, ELTIFs in the NAO app are invested in a regular portfolio without a subsidy. NAO does not currently offer a certified retirement savings portfolio.

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This article is for informational purposes only and does not constitute investment advice. ELTIFs are long-term investments: capital is tied up for the duration of the term, redemptions are restricted, and losses up to the total loss of capital are possible. The Key Information Document (KID) and fund documentation are the definitive sources. For funds in the NAO app, you can find both directly in the app.

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