Livret A: Why your savings earn so little (and which alternatives can truly help them grow)

🔍 The Livret A: definition and how It works

The Livret A is a government-regulated savings account in France. Available to any individual, with no income or age requirements, it is the most widely used savings product in the country. Its primary purpose is to allow households to keep money readily available at all times, with no risk of capital loss.

Its operation is simple: deposited funds remain fully accessible, and interest is calculated automatically based on a rate set by public authorities. The money is not locked in, meaning savers can deposit or withdraw funds at any time without fees or penalties.

The capital held in a Livret A is guaranteed by the French state, making it an especially secure product. In addition, all interest earned is completely exempt from income tax and social contributions, which distinguishes it from most other investments.

However, the account is capped: deposits are limited to €22,950 (excluding interest). Once this ceiling is reached, no further deposits can be made, although interest will continue to accrue on the existing balance.

The funds collected are not simply held by banks. A large portion is centralized by the Caisse des Dépôts and used to finance projects of public interest, particularly social housing, urban renewal, and certain public infrastructures.

Thanks to its safety, simplicity, and full liquidity, the Livret A is typically used as an emergency savings tool, designed to cover unforeseen expenses rather than to generate high returns.

💸 How much does the Livret A earn today?

Since February 1, 2026, the Livret A interest rate has been set at 1.5% per year, net of taxes and social charges. This rate is revised approximately twice a year by the government, based in part on inflation and short-term interest rates.

In practical terms, this means that for every €1,000 deposited, the annual gain is about €15.

Annual return examples:

€1,000 → about €15 per year

€5,000 → about €75 per year

€10,000 → about €150 per year

€20,000 → about €300 per year

€22,950 (maximum) → about €344 per year

Interest is calculated automatically and added to the principal each year. The return is therefore safe but relatively low, especially for those looking to grow their savings meaningfully.

It is also worth noting that the Livret A rate has fallen significantly in recent years: it stood at 3% between 2023 and early 2025, then 1.7% in late 2025, before being reduced to 1.5% in 2026 as inflation declined.

Although the return remains guaranteed and risk-free, it is limited and generally insufficient to generate meaningful income, particularly for modest savings amounts.

📉 Why you lose money with the Livret A

The Livret A is often perceived as a safe and “cost-free” investment, but in reality it can erode purchasing power. This is not because the nominal capital decreases, but because the money grows more slowly than the cost of living.

The main factor is inflation. When prices rise, each euro buys fewer goods and services. If your savings earn less than inflation, your real wealth declines, even if your account balance increases slightly.

For example, with a Livret A rate of 1.5% and inflation at 2.5%:

- Your savings gain 1.5% in nominal terms

- Prices rise by 2.5%

- Your purchasing power decreases by about 1% per year

In other words, you are “losing money” in real terms.

Unlike many investments, the Livret A rate is not determined by market forces. It is set by the government according to an official formula and then adjusted at its discretion. This decision takes into account several factors, including inflation, interbank rates, and broader economic considerations.

As a result, the rate is often below inflation, notably to limit the cost of financing social housing and to maintain the balance of the banking system.

🏠 What is the difference between investing in Shelters and the Livret A?

Shelters offers a different approach to traditional savings by allowing individuals to invest directly in real estate projects with accessible amounts. While traditional property investment usually requires substantial capital, Shelters enables participation with smaller sums while providing exposure to the income generated by the financed assets.

The model is based on collectively funding tangible real estate operations: acquisition, renovation, operation, or resale. In return, investors receive income derived from the project’s actual performance, typically distributed on a regular basis. The money is therefore not placed in an abstract financial product but directly backed by real, physical assets.

Targeted returns can be significantly higher than those of regulated savings accounts because they come from the real economy: rental income, value creation through renovations, and capital gains upon resale. Unlike the Livret A, there is no administratively capped rate. Depending on the project, expected performance can reach several percent per year, offering the potential for much faster capital growth.

However, this higher return potential comes with greater risk. Capital is not state-guaranteed and depends directly on the success of the real estate project. Delays, market fluctuations, or technical and economic uncertainties can affect results. Liquidity also differs: investments are typically made for a defined period, and resale may depend on specific conditions.

Despite these risks, real estate has historically been sought after for its balance between stability and performance. By pooling investments and simplifying access, Shelters aims to offer a particularly attractive risk-return profile for savers looking to enhance part of their capital.

📌 Conclusion

The Livret A remains an excellent tool for building an emergency fund. Its capital guarantee, immediate availability, and tax exemption make it ideal for handling unexpected expenses and maintaining a safety cushion. However, its limited return generally does not allow for meaningful long-term wealth growth, especially during periods of inflation.

For savers seeking to truly grow their capital, it is often necessary to consider investments linked to the real economy that offer higher performance potential. Real estate is one such asset class, but it has historically been accessible mainly to investors with significant financial resources.

Solutions like Shelters now make it possible to access this asset class with smaller amounts, while targeting regular income and capital appreciation. In exchange, these investments involve greater risk and typically require a longer investment horizon.

The most balanced strategy is often to combine both approaches: maintaining a secure base in guaranteed products for peace of mind, while allocating part of one’s savings to solutions capable of generating higher returns.

Rather than opposing safety and performance, the goal is to combine them intelligently to build savings that are both stable, useful for everyday needs, and capable of growing over time.

🔗 Start investing in tokenized real estate from just €10 with Shelters!