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REVEALED: Which German cities have the most millionaires?

New research has shown how Germany's millionaires are distributed throughout the country, with one city coming out on top - and it might not be where you expect.

Published: 3 August 2023 16:19 CEST
Two people toast with champagne on a beach.
Two people toast with champagne on a beach. Photo: Pixabay/Pexels

Of the approximately 46 million working people in Germany, nearly 30,000 earn more than €1 million per year. While these high-income earners are spread out across the country, a recent analysis by the Handelsblatt Research Institute has shown how unevenly distributed they are. 

The study, conducted using income tax returns for the year 2019, found that there were 27,300 income millionaires in the year under review, marking an increase of about 1,200 compared to 2018. As tax returns are often prepared and audited several years later, the 2019 data is the most recent available.

READ ALSO: REVEALED: Where in Germany people earn the most (and least)

In the list of cities with the most millionaires per 100,000 people, Düsseldorf came out on top, with 172 millionaires per 100,000 taxpayers. 

While the figures don’t explain why so many high-earners choose to live in Düsseldorf, the city’s strong economy and business-friendly environment, its proximity to the Rhine and its rich cultural and leisure offerings – as well as its reputation as a place for high fashion – likely contribute to its popularity. 

North Rhine-Westphalia’s second most populous city pipped the Bavarian capital Munich to the post, where there were 170 millionaires per 100,000 taxpayers. Baden-Württemberg’s capital Stuttgart came in third place, with 142 per 100,000.

At the state level, Hamburg tops the list of the federal states with the most millionaires, with 124 per 100,000 taxpayers. 

Meanwhile, Bavaria, known for its picturesque landscapes and mountains, experienced a surge in the number of millionaires, reaching 90 millionaires per 100,000 taxpayers, up from just 49 in 2015.

On the other end of the spectrum, the five eastern federal states – Brandenburg, Saxony, Saxony-Anhalt, Thuringia and Mecklenburg Western Pomerania –  continue to rank at the bottom in terms of millionaire density.

Berlin saw the largest increase in millionaire concentration among the federal states within a year: the capital city gained around seven millionaires per 100,000 taxpayers, moving up two places to claim the sixth place. Schleswig-Holstein (plus six) and Bavaria (plus three) also saw notable increases.

READ ALSO: Germany ranks third worldwide in number of ‘ultra-rich’ residents

A completely different picture emerged when looking at the number of millionaires in smaller districts and urban areas.

Starnberg in Bavaria, located near Munich and the Alps, had by far the most millionaires, with 428 top earners per 100,000 taxpayers. Following closely was the Hochtaunus district near Frankfurt, which is home to many of the Hessian city’s top bankers.

The Alps and the Zugspitze can be seen in the background of Lake Starnberg. Starnberg is the district with the most millionaires in Germany. Photo: picture alliance/dpa | Sven Hoppe

Eight out of the top ten districts and cities with the highest density of income millionaires are found in southern Germany. These include Starnberg, Miesbach, Memmingen, and Landshut in Bavaria, as well as Baden-Baden and Heidelberg in Baden-Württemberg. 

How rich are Germans in general?

One prominent study that looks into the finances of private households in Germany is the “Private Haushalte und ihre Finanzen” –  Private Households and Their Finances – which is conducted by the Bundesbank every three years.

The survey includes assets such as real estate, vehicles, bank deposits, and private pension and life insurance claims, as well as debts like mortgages and loans. The latest survey in 2021 reported that German households reached an average net wealth of €316,500, a record high over the past decade. Notably, between 2017 and 2021, average wealth surged by 36 percent.

The study also highlighted a significant rise in the median net wealth, i.e. the number between the highest and the lowest net worth. In 2021, the median net wealth was €106,600 – a dramatic increase of over 100 percent from 2011, when the median stood at €51,400.

The disparities between the average and median figures also reveal the uneven distribution of wealth: to belong to the wealthiest 10 percent of households, households need to have net wealth of at least €725,900.

READ ALSO: How much do you have to make to be considered rich in Germany?

On a broader scale, the “Sozio-oekonomisches Panel” – Socio-Economic Panel – conducted by the German Institute for Economic Research (DIW) annually surveys nearly 30,000 individuals from approximately 15,000 households. The report from 2019, using SOEP data for 2017, revealed an average individual net wealth of €108,449. In stark contrast, the median value stood at €26,260 – significantly lower than the average.

The DIW report also showed an encouraging trend in Germany’s wealth landscape as, between 2012 and 2017, the average net wealth per person increased by nearly 22 percent. 

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BANKING

Reader question: Is it safe to give out your IBAN in Germany?

Even in privacy-obsessed Germany, you'll often be asked to provide your bank details - or IBAN - when purchasing products or setting up contracts. Is it always safe to do so - or is there a chance of fraud?

Published: 20 September 2024 12:28 CEST
Reader question: Is it safe to give out your IBAN in Germany?

When it comes to personal data concerns, there’s arguably no nationality who is more keen to keep their private lives private than the Germans. 

This was summed up recently at one cashless business in Berlin, where the owner revealed that people were concerned that paying by card would let the company see into their bank account. 

But in spite of the general suspicion towards digital technologies, there are plenty of situations in Germany where you’re likely to be asked for your International Bank Account Number – or IBAN for short – and are expected to give it willingly.

You may be setting up a new contract for your electricity supply, a new mobile phone or for a rental flat. Or you could be buying something online via a direct debit or hunting for bargains on an online marketplace – in all these cases, giving your IBAN to the seller or company is a must. 

READ ALSO: Why German banks are getting more customer complaints than ever

Though simply jotting down your details is treated as par for the course, are there situations where consumers should be a bit more cautious? 

Here’s an overview of what you should know about the risks of giving out your IBAN and how consumers can best protect themselves against fraud. 

Is giving out my IBAN safe?

According to Matthias Lange, payment methods expert at the German Association of Banks (BVDB), the answer is generally yes – and often there are no ways around it.

“For example, if I want to pay my rent or have my money transferred to my account for a sale via classified ads, I have to give the account details to my landlord or the buyer,” Lange explained on the ING website. “And if I buy something by direct debit, they will also ask for my account number.”

Lange also points out that it’s perfectly normal for companies to include their IBANs on letters and bills they send out, which shows just how relaxed their are about customers having this information. 

What could a fraudster do with my IBAN?

Very little, is the answer – though there are options. 

The most important thing to know, however, is that nobody will be able to access your bank account using the IBAN alone.

In online banking in the EU, two-factor authentication is a minimum. Normally, that means you’ll need a password to access your account, as well an authentication app or a code that’s sent to your mobile phone.

All of this makes it much harder for criminals to access your financial data and make fraudulent transactions.

READ ALSO: How to grow your savings in Germany during high inflation

However, there is one way that fraudsters could try to use your IBAN to steal money from your account: setting up a Lastschriftmandat, or a mandate for a direct debit. This can usually be done by setting up a simple form and sending it off to the bank or company in question.

Even in this situation, however, the problem can be easily resolved. 

Woman paying by card online

A woman checks her card details while completing a purchase online. Photo: picture alliance/dpa/ZHPH Production / Stocksy United | N26 GmbH

“If a fraudster has actually completed a direct debit with your account details, it is possible that the amount will initially be debited from your account, but you will be able to get the money back quickly and easily,” said Lange.

This strategy is also a risky one for any criminal, since the bank will have plenty of information on hand about the person that the money should be transferred to.  

Another old-fashioned option is for someone to intiate a paper translation by forging your signature on a paper transfer form – though this would probably arouse suspicion as this type of transfer is so rarely used today.

Lange also points out that this would involve the criminal supplying their bank details, and that a swift response to the issue would enable any victims to get their money back right away. 

How can I best protect myself from fraud? 

Though giving out your IBAN is generally safe, you should still remain cautious about giving out more details than are necessary – particularly when it comes to things like passports or information that’s included on personal IDs. 

A major red flag for phishing attempts – that is, attempts to steal your data – is if you are approached out of the blue and asked for specific data.

That could be through an unexpected phone call, a link to a website or an email that looks like it comes from an official source, like a credit card company or a bank. In these cases, a good rule of thumb is that no bank will contact you and ask for a tonne of personal details, and especially not passwords or pin numbers. 

In other circumstances, such as applying for a flat, if are asked for extra information – like your passport and bank account statements – make sure that the housing company is reputable before handing all the information over. 

If in doubt, simply get in touch with your bank and ask them for their advice. It’s in their interests to avoid fraudulent transactions on your account, so they will be more than happy to help.

Another important thing to do is to check your bank account regularly for unexpected transactions. You can generally recover any money that’s taken from you fairly easily, but the quicker you respond, the better.

According to Lange, there are key deadlines to know about if you want to challenge or withdraw a direct debit transaction.

READ ALSO: Why it’s almost impossible to find a free bank account in Germany

In normal cases, you have eight weeks to do this – but if the transaction is made via an unauthorised madate, this can be extended by more than a year. 

Though there are no official figures on the level of IBAN fraud carried out in Germany, Lange believes it’s nothing in comparison to the some 11 billion direct debits that are completed in the country each year.

A more common practice is for criminals to buy goods via invoice and get the invoice sent to an unwilling addressee. 

“But that’s more of a problem for the retailer and has nothing to do with fraudulent IBANs,” Lange explained. “And of course, you don’t have to pay the invoice.”

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