LIVRET A. The Livret A rate will be revalued on 1 August 2022. The increase could be greater than expected, more than 2% according to the governor of the Banque de France, François Villeroy de Galhau.
[Mis à jour le 11 juillet 2022 à 08h11] To take into account inflation, in particular, the Livret A rate will already undergo the second increase after the one observed on 1 February, from 0.5% to 1%. This time around, the increase should be much larger. The governor of the Banque de France, Francois Villeroy de Galhau speaks of a “significant” revaluation from 1 August 2022. Recall that the passbook rate A, the French favorite savings product, is calculated by taking the average of the money market rates of the last six months and the inflation rate (in this case 5.9% in June over one year) . “Overall, according to my calculations, we go down to an increase of 2%. If it is 2.2% they give a slight boost, if it is 2% it is slightly less” Filippo Crevel, Director of the Cercle de l’Epargne. Hence, the possibility of a rate A close to 2.5% is not so utopian, particularly due to the steady rise in the consumer price index.
The next step for the governor of the Banque de France is to send his revaluation proposal to the Minister of Economy Bruno the Mayor through a letter, July 13, 2022. Then, the tenant of Bercy will make his informed decision, and announce the amount of the increase in booklet A which will take effect on August 1st. The level of inflation and interest rates for July are still expected and will be closely scrutinized to formalize a specific rate hike. The moment is in no hurry for François Villeroy de Galhau who is waiting to benefit from all the information necessary to formulate his recommendation. The revaluation of livret A should also allow other savings accounts to benefit from a revaluation, LDDS (potentially 2.2%) and LEP (potentially 4.6%) as a leader. Remember that the ceiling on the French favorite savings product is set at € 22,950S. Finally, anyone, major or minor, has the possibility to open a booklet A in France. Only problem, it is impossible to keep several in different banking institutions.
The ceiling of Livret A is fixed to € 22,950, for individuals. We remind you that the payment of interest may well exceed this limit. As an indication, the associations benefit from a much higher ceiling, at 76,500 euros. Anyone, minors or adults, can open a booklet A. On the other handit is not possible to hold more in different establishments. To open a livret A it is necessary to sign a written contract with your bank, specifying in detail the authorized operations (bank transfer, payment, withdrawal, etc.). It is forbidden to combine two regulated booklets of the same type (Livret A and Livret Bleu) for the same person.
On the other hand, it is quite possible to combine a brochure A with a brochure on sustainable development (LDD) or a brochure for young people. Furthermore, it is possible to combine regulated passbooks within the same tax family. To close a livret A, simply contact your banker, by post or by going to an agency. You will need to specify the reference of your livret A and fill in the details of your current account, LDD, CEL … or other account to which you wish to transfer the funds. In case of closing during the year, the capitalized interest is credited to the account on the day of closing.
From 1 February 2022 the rate for booklet A was revalued for 1%. We recall that the rate is set by the Ministry of Economy and Finance on the recommendation of the Banque de France, according to a mathematical calculation that takes into account the level of inflation and interest rates. Much loved by the French, we remind you that booklet A has a significant advantage: its interests are not subject to income tax and social security contributions.
The Livret A tariff is increased to 1%. In other words, when you benefit from savings of € 1,000you pocket 10 euros of interest only against 5 euros of interest with the previous remuneration set in 0.5%. Find out the amount of your interest, depending on your savings:
- Savings of 1,000 euros: 10 euros of interest (€ 5 net profit compared to the previous rate)
- Savings of 2,000 euros: 20 euros of interest (10 euros net profit compared to the previous rate)
- Savings of 3,000 euros: 30 euros of interest (€ 15 net profit compared to the previous rate)
- Savings of 4,000 euros: Interest 40 euros (€ 20 net profit compared to the previous rate)
- Savings of 5,000 euros: 50 euros of interest (€ 25 net profit compared to the previous rate)
- Savings of 10,000 euros: 100 euros of interest (50 euros of net profit compared to the previous rate)
- Savings of 22,950 euros (maximum): 229.5 euros of interest (114.75 euros of net profit compared to the previous rate)
The interest of livret A is calculated the 1uh and 16 of each month, then every fortnight. Of course, if you deposit money into your savings account A between 1uh and the 15th of the month, the calculation will take effect from the 16th. If you make a deposit between the 17th and the end of the month, you will need to wait until the following month for the accounting date of the account value in the interest calculation. Have you made a withdrawal? Interest is calculated in the current period.
The total interest is added to the principal at the end of the year. When you want to calculate your interest, you then need to multiply your savings account balance by your rate and divide it by 24 (number of fortnights in the year). But beware, this calculation has only a theoretical value. To calculate your return, you must take into account all the movements made on the booklet.
Any person, major or minor, can have a livret A. The bank where you want to enroll in livret A must question the tax authorities to verify that you only have one. The property cannot open a brochure for you until they receive this response.
Therefore, you must provide your property with photo ID and proof of address that is less than three months old. For minors, remember to bring a copy of the family booklet or a birth certificate with you. The signature of one of the parents will also be required.
Good to know, when opening an account, a minimum payment of 10 euros is required, which at the Banque Postale drops to 1.50 euros. Depending on the banking institution, various means of payment are accepted to make this payment, check, cash or wire transfer. Most banks now offer opening a savings account 100% online or in an agency if the customer so wishes.
Previously reserved for the clients of Caisse d’Epargne, Banque Postale and Crédit Mutuel (under the name of livret bleu), livret A can be offered by all banksincluding online banks, since 2009.
It is not possible to transfer a livret A from one bank to another from 1uh January 2012. This transfer has been possible since 1uh January 2009 to December 31, 2011. From now on it is necessary to close the savings account A in the old bank before opening a new one in another bank. If you have forgotten the existence of a livret A and the account has been inactive for 10 yearsis automatically transferred to the Deposit fund who holds it, she, 20 years. You have the possibility to carry out a free search if you have a booklet A that you have forgotten and, therefore, to request a refund of the remaining amount.
What is the role of a booklet A? The latter can look like precautionary savings, in addition to his current account. It is advisable to put two to three months’ salary on his A book. But there are other ways to save, some of which have seen their rate highly revalued as the LEP. Subject to income proof, the LEP is a guaranteed investment reserved for people domiciled in France and whose resources are limited (20,296 euros of reference tax income for a single, 31,135 euros for a couple). Its tariff, located at 1%, it will also be revalued due to uncontrolled inflation. A huge boost for LEP, which is expected to reach a rate of 2.2%! the LEP ceilingis fixed at € 7,700, excluding capitalized interest. Its extremely attractive rate could very well make it a real alternative to the Livret A account in the eyes of savers. Are you eligible for LEP? In France, 15 million people can benefit. Recall that livret A, like LEP, remains a tax-free savings product. The interest accrued by savers is not subject to income tax or social security contributions.
Do you have an extra nest egg and are you looking to study savings and investment products that make your money grow? Consult our sheet to find out about the alternatives to booklet A!
This is one of the benefits of this regulated savings product. The interests of livret A are exempt from income tax. They are also not subject to social security contributions. Livret A also allows you to make transfers and withdrawals without limitations in number and free of charge. Finally, it allows the saver to have capital immediately available.
To close your booklet A, you have two possibilities. Send a letter to your bank or go directly to the agency. In any case, it is necessary to indicate the references of passbook A and the account number on which to deposit the remaining sums in the passbook. Your bank must close your account within 15 business days. In order to prove the date of receipt of the request by the bank, it is necessary to send the letter by registered mail or ask for confirmation of receipt at the counter. If livret A is closed during the year, interest on the period from the beginning of the year is credited on the day the account is closed.
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