Loans, investments, insurance: the many questions about money

Inflation, investments, account management, loan agreements: Monday evening in the district office of the Perg Chamber of Labor, everything revolved around the rights of consumers in matters of money. What is the best investment currently? Where is the best place to go in case of damage? And what should you do if the insurance company refuses to pay? At the 20th edition of the “Caution, Trap” event – a collaboration between the Upper Austrian Chamber of Labor and the OÖ Nachrichten – all these questions and many more were answered by the consumer protection experts of the Chamber of Labor, Gerhard Augustin and Johann Kriegner.

The questions of the numerous Perg visitors showed that many are upset by the current crisis situation and do not know how to best invest their money right now.

What would be a good form of investment for 10,000 euros that you don’t need urgently?

Gerhard Agostino: If you want to invest money, there are three important points to consider: First, am I willing to take the risk of capital losses? Second, can I make a long-term commitment or is it essential to always have access to my money? And third: what earnings do I expect? You should therefore first clarify your priorities before making a specific investment decision.

Would you recommend a fixed or variable interest rate for a loan? And how do you assess the future trend of interest rates?

Gerhard Agostino: It is difficult to give a general recommendation, so you should look into it in each individual case. While the loan rate is automatically adjusted to the current interest rate level in the case of floating rate loans, the loan rate in the case of fixed rate loans remains unchanged for the agreed period even in the event of an increase in interest rates. After a long period of “negative interest rates”, interest rates have increased significantly in recent months. There is currently no end to this development, hence the preference for fixed interest rates. If you have an existing loan agreement, you are bound by it.

During a severe storm, my neighbor’s construction site was not adequately protected. The material flew to my property and caused damage there. Which insurance company has to pay in this case?

John Krieger: A storm is a general event where the force of the wind also plays a role as an argument for insurance coverage. A storm is only considered to be a storm greater than 60 kilometers per hour. The neighbor’s storm insurance only covers his property. Who can be called to pay in this case is the civil liability insurance of the injured party. But only if you can accuse the neighbor of negligence by not securing his construction site. After all, your property was damaged by the storm.

In some cases, the insurance will not pay. Does the person selling the insurance also have an obligation to inform their customers?

John Krieger: No, the information obligation does not go that far for insurance company sellers. You have to differentiate: there are insurance representatives, agents and brokers. If you ask me who to consult in this case, I would recommend a broker. This is always on the customer’s side and evaluates which product is best suited to the respective contractor.

Can you withdraw from insurance if you no longer need it?

John Krieger: Two or three years ago, the legislator introduced a 14-day right of withdrawal. When you buy a product at the supermarket, you can evaluate exactly whether you really want to buy it. With insurance, this is different. Basically, you should read the terms and conditions in good time, even if they are very complex. Without giving a reason, you can withdraw up to 14 days after the conclusion of the contract. After this period, the night is not possible.

questions from the audience

“What should I do if the insurance company doesn’t want to pay?” – Daniel Holzer

John Krieger: In the first consultations I often hear that insurance companies do not provide a specific reason and withdraw from the insurance contract. I would insist on a written reason for taking legal action against it.

“Which makes more sense: to repay the loan or better to go to safety?” – Melanie Schaumberger

Gerhard Agostino: I recommend having about three months’ salary as a nest egg to be prepared for the unexpected. If not, special loan repayments make economic sense. But you should take a close look at the loan agreement.

“How should I invest my money: in gold, silver or should I buy real estate?” – Harald Matzinger

Gerardo Agostino: The flight to real assets has advantages and disadvantages. Gold, for example, is very popular as a precaution in the event of a crisis, but it does not generate any interest and is also subject to fluctuations in value, just like real estate. I do not recommend betting everything on one horse.

“In this time of crisis, consultancy certainly provides security”

Loss of income, high inflation, financial problems – many employees are currently facing major challenges due to the current wave of inflation. Above all, according to the president of the Chamber of Labor Andreas Stangl, it is the accumulated crises that are responsible for the sorrow: before it was the crown pandemic, now it is the wave of inflation and many private individuals have already exhausted their savings. “There are often problems with banks and insurance companies. Many ask the question: are they getting us out of these institutions?” Says Stangl.

Seek timely advice

Most important in these times: “Don’t put your head in the sand. The banks, social counseling centers and consumer protection organizations of the Chamber of Labor are there to help with financial bottlenecks,” he says. Stangl. Consumer Protection employees are currently processing more than 33,000 applications. “Our team works hard so that everyone gets their money on time,” says Stangl and wants to keep putting the pressure on.

“We have the highest inflation in 70 years and at the moment the politicians are not fighting it, they are fueling it. The price of CO2 is giving people a hard time, at some point they won’t be able to afford it anymore,” Stangl says. Many are already thinking very carefully about what they will buy. A situation that, according to Stangl, is no longer acceptable.