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What will be left in your wallet in 2024?

2023 was not an easy year for consumers. Will the next one be better? A look ahead shows that there are at least some positive signs.

Numerous economic research institutes anticipate a significant slowdown in inflation in
Numerous economic research institutes anticipate a significant slowdown in inflation in 2024. (Illustration)

Finances - What will be left in your wallet in 2024?

Inflation, economic uncertainty, wars: After the difficult pandemic years, 2023 did not bring a noticeable upturn for many people either. What will 2024 be like?

Economy and purchasing power

The good news first: numerous economic research institutes expect a significant slowdown in inflation in 2024. The German Council of Economic Experts is forecasting an increase in consumer prices of just 2.6% and moderate growth of 0.7% for the new year.

KfW Chief Economist Fritzi Köhler-Geib expects that the new year will therefore be better financially than previous years. "However, it will still take some time to make up for the real income losses of previous years. If everything goes well, we could be there by the end of 2025," says Köhler-Geib.

Real wages have recently risen faster than consumer prices. Experts therefore anticipate an improvement in purchasing power and a recovery in consumers' moderate spending mood.

Minimum wage and citizens' income

The minimum wage will also increase for employees in 2024. This will rise by 41 cents to 12.41 euros on January 1. Many employees can also look forward to an increase in sector-specific minimum wages set out in collective agreements, including roofers, building cleaners, painters and care assistants and specialists. There will also be an increase for trainees after the turn of the year. The minimum wage in the first year of training will rise from 620 to 649 euros.

The citizen's allowance will also be adjusted in the new year. The standard rate will be adjusted annually in line with prices and wages. For more than five million adults and children on basic income support, the Citizen's Income will increase by an average of twelve percent. For single parents, for example, it will be increased by 61 to 563 euros. Adults who live with a partner will receive 506 euros.

Pensions and parental allowance

Pensioners in Germany will have more money in their wallets from July 1, 2024. According to an official estimate, they can expect an increase of 3.5 percent. This is according to a draft of the German government's pension insurance report, which is currently still being voted on. The final figure for the increase will be determined in the spring.

There will also be an increase in the reduced earning capacity pension: Those who retired between 2001 and June 2014 will receive a 7.5 percent increase. If the pension started between July 2014 and 2018, there will be an increase of 4.5 percent. In total, around three million pensioners will benefit. The supplementary income limit is also rising.

Changes await young families. In future, only parents who have a taxable income of less than 200,000 euros in the calendar year before the birth of their child will be able to receive parental allowance. Previously, the limit was 300,000 euros. In 2025, the limit is to be further reduced to 175,000 euros.


Citizens will receive more net from gross in 2024. The basic tax-free allowance, i.e. the income up to which no tax has to be paid, will rise from 10,908 to 11,604 euros. The tax-free allowance for children will also be increased. The benchmark for the top tax rate of 42% will rise to €66,761 (2023: €62,810).

For some employees, however, social security contributions will also increase in the new year. Due to the increase in the income threshold, the contribution to health and long-term care insurance for high earners with statutory insurance will rise: for a gross income of 60,000 euros by 16 euros per year, for 70,000 euros by 234 euros, for 90,000 euros by 488 euros and for 100,000 euros by 552 euros.


Health insurance contributions may rise slightly in 2024. The federal government has increased the reference value by 0.1 points to 1.7 percent. However, the exact amount is determined by the health insurance funds themselves. Techniker Krankenkasse, the largest health insurance provider in Germany with eleven million policyholders, intends to keep its contribution stable (1.2 percent). DAK Gesundheit is also leaving its additional contribution unchanged (1.7 percent). Barmer, meanwhile, is planning a significant increase. The second-largest health insurance company with more than eight million policyholders wants to raise its supplementary contribution by 0.69 percentage points to 2.19 percent.

Many privately insured people must also expect contribution increases. According to an estimate by the Association of Private Health Insurers, costs will rise by an average of seven percent.

Restaurant visits

Visiting restaurants and cafés could also become more expensive. From January 1, the normal VAT rate of 19 percent will apply again instead of the temporary reduced rate of 7 percent. It can therefore be assumed that restaurateurs will pass this on to customers.

Heating, electricity and petrol

Energy will remain an issue in 2024 that will hit your wallet. The comparison portal Check24 expects gas costs to total EUR 2537 in 2024 for a sample household with an annual consumption of 20,000 kilowatt hours. This is EUR 370 more than in 2023, with the largest share (EUR 217) coming from the VAT rate being raised again from 7% to 19% on March 1. The increase in the CO2 price at the turn of the year and the expiry of the price brake, which capped the energy price above a certain level, also led to higher costs in the model calculation.

In the case of electricity, the price cap will also expire at the turn of the year. Grid charges will also rise significantly. According to Check24, the electricity costs for a typical household with an annual consumption of 5,000 kilowatt hours are expected to rise by EUR 144 in the coming year as a result. However, many energy suppliers have recently announced price reductions due to lower procurement prices.

Rising fuel costs are also to be expected. According to the ADAC, a liter of petrol could become around 4.3 cents more expensive at the turn of the year due to the rise in CO2 prices. Diesel drivers can expect an increase of around 4.7 cents.

Insurance and mobility

There will also be price increases for insurance. According to the Verivox car insurance index, policies have become 13 percent more expensive on average. Building insurance premiums are also likely to increase. This is due to increased trade, material and construction costs as a result of high inflation.

It is not yet certain what will happen with the Deutschlandticket and whether it will remain at the introductory price of 49 euros. The fee could rise in mid-2024. In any case, flying will become more expensive. The ticket tax for passenger flights is set to rise according to the German government's plans. The amount depends on the length of the route. It is not yet clear how much this will cost consumers.

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