Getting the work-life balance right

A survey of attitudes towards work among European Millennials shows that young people are seeking a better balance between work and leisure. Young Germans in particular want jobs that don't take over their lives.

Getting the work-life balance right
Roman Diehl (left) and Marcel Rasche of Consulting Cum Laude.

Munich-based firm Consulting Cum Laude conducted the survey of Generation Y members from Germany, Spain, the Netherlands and the UK.

The findings, released on March 18th, contradict the perception that Generation Y members are work-shy and unwilling to put in the necessary graft, company CEO Roman Diehl told The Local.

“Our survey clearly showed that Generation Y are very keen on developing themselves. They want to have success, but in a different environment to the one we worked in when Generation X were young,” Diehl said.

“It has a lot to do with having more time for themselves and their family. When I started my career, we were working 60 to 70 hours a week. Generation Y know where their physical barriers are. It is a reflection of their childhood. When they grew up, their families didn't have time for them, there were divorces or fathers were getting heart disease.”

Seeking the good life

The survey shows that even the Spanish, whose country has been hard hit economically over the past few years, still value finding the right balance between work and play. Despite a youth unemployment rate of about 50 percent, young Spaniards named work-life balance and an enjoyable work environment as more important than job security.

But economic conditions in their country have still had an affect in shaping their mentality.

“The Spanish show willingness to do everything to increase employability,” Diehl pointed out.

They change subjects at university if they find one that they think will increase their career options. “Spaniards are used to making fast decisions, are very willing to change country and job” if it means giving them a career advantage, he said.

Young Germans have a different attitude. 30 percent of them were categorized by the survey as being 'conservative' in their approach to work. Diehl explained this as meaning they do not place a high value on career progression or salary, but look for job security and satisfaction within the work place.

"In Germany where Gen Y has a strong economic background, and where they have the financial security of their families, it is okay to earn a reasonable salary. They are more satisfied staying with the job they really enjoy," he said.

“More Germans said that when it is not possible to integrate private and professional life, then their private life is more important.”

Brits still see career as important

Young Brits on the other hand are more characterized by the traits that were common among Generation X. Twenty-four percent of young Brits said that their career was the most important thing in their lives, compared to only ten percent of German respondents. Brits are also much more likely to be highly ambitious and seek to become leaders within their organisation than Germans.

And they are prepared to suffer to achieve it. Only 33 percent of Brits said that enjoying their work environment was important. Over half of Dutch and Germans said it was important, and even Spaniards, despite their economic woes, were more likely to see this as important as Brits.

“[For these Brits] earning money and building a career is more relevant,” Diehl said.

This all leads to Diehl to think that Brits would make good employees for the German financial sector.

“It might be helpful for banking and insurance companies to look across the channel. I have had talks with HR professionals at banks who admit that they have an image problem in Germany. If you look at how Generation Y here view this sector, only 8 percent see it as a desirable field of work.”

The survey found that more than double that percentage of Brits see finance as attractive.

Companies changing too slowly

But Diehl warned that German companies still have a long way to go before they properly adjust to the needs of the modern young professional.

“We observed strong hierarchy in German companies: Human resources departments are redesigning career development by evaluating the needs of employees and working towards the talents of young employees. But the large companies are slow in implementing change," he said.

“For many young people when they enter the company it is quite a different world from what they have been promised – it is not dynamic, not multifaceted. And when reality doesn't cope with the promises of HR marketing, the young talents won't stay long.”

But even in this respect there are differences between Generation Y in Britain and Germany.

“In the UK more young people want to work for a global player. Germans don't really care about this. If the company can't show the impact that you will have then Germans won't choose your company.

This means that if you are a DAX 30, it doesn't mean that you don't have to do anything to attract talent.”

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7 tips for how to survive as a freelancer in Germany

Taking the decision to go it alone and freelance in Germany can be a daunting prospect. But, if you do it right, it can be an exciting and liberating path. Here are some of our top tips on how to survive.

7 tips for how to survive as a freelancer in Germany

1. Get a tax advisor

The German tax system is complicated, even for Germans. All the associated paperwork uses the Amtsprache (authority language) which is more like legalese than ‘normal’ German, and mistakes when filling out tax forms can cause you, at best, a massive headache and, at worst, a costly fine. So it’s best that you employ someone who knows what they’re doing to help you out.

That person is called a Steuerberater (tax advisor) in Germany. They will help you register with the tax office, correspond with them and submit your tax declarations.

Be aware that, in Germany, different deadlines apply for tax returns depending on whether you employ an official tax advisor or not. If you are doing the tax return on your own, the deadline for submitting your annual tax return is earlier than if you use a tax advisor’s services. 

READ ALSO: What NOT to do when you’re freelancing in Germany

When looking for a tax advisor, a top tip is to use your network to get recommendations. Ideally, you want someone who will do more than just fill in the forms for you, but who will actually advise you on how best to manage your business finances so that you can make tax savings.

2. Keep your accounting in order

The better you keep your own accounts in order, the easier it will be for your tax advisor to compile your tax declarations and therefore the cheaper their services will be.

As a freelancer, there are a lot of costs you can deduct from your taxes – from train tickets, working materials, to meals out – so it’s best to keep hold of all your receipts and to keep them in good order.

2 euros and 50 cents lie on a receipt in a beer garden. Photo: picture alliance/dpa | Peter Kneffel

In Germany, you’re obliged to keep hold of receipts for two years, in case of a tax inspection, so it’s a good idea to photocopy the type of machine-printed receipts you get from restaurants so that they stay legible for a long time.

There are also a few things to be aware of when writing your own invoices. Firstly, make sure that you include your tax number. This isn’t the 11-digit Steueridentifikationsnummer that everyone gets when registering in Germany, but the 10-digit Steuernummer you get from the Finanzamt after registering yourself as a freelancer. 

Most companies won’t pay you if you don’t have this on your invoices so make sure you include it.

You should also make sure that you number your invoices properly – ideally in ascending order so that you can easily keep track of them. You are not allowed to issue two invoices with the same number and if you do so and the finance office notices, you could face an inspection of your whole accounting system.

There are numerous great accounting software programmes you can use to help you, such as Lexoffice and Sevdesk and, even if you have to pay for them, the costs will be tax deductible!

3. Find out if you’re eligible for financial support

In Germany, there are several opportunities for freelancers to gain financial support and to cut their outgoings, and its worth finding out if you’re eligible for them.

If you’re claiming unemployment benefits under ALG 1 and are thinking about becoming a freelancer, the employment office offers a special type of financial support to help you to get your freelance business off the ground.

Called the Grundungszuschuss (“foundation grant”) the payment is a six-month grant equalling your monthly entitlement under ALG 1 plus €300 towards your insurance costs can be applied for those in receipt of this unemployment benefit.

READ ALSO: Will freelancers benefit from Germany’s €300 energy allowance?

If you are engaged in some form of artistic profession in Germany – which can include journalism to pottery – you may be entitled to membership to the Kunstlersozialkasse (artists’ social insurance).

Being a member of the KSK means you only have to pay half of your health insurance and pension contributions, and the KSK will pay the rest.

4. Work out how much you think you will earn

As with starting any business, you need to have some idea of your expected earnings from the outset.

If you’re just starting out as a freelancer, or have some freelance gigs on the side of an employment position, then it might be worth considering registering yourself as a Kleinunternehmer (“small business”).

As a Kleinunternehmer, you can currently earn up to €22.000 per year without having to charge VAT and having to submit only yearly tax declarations. 

An income tax declaration form lies on a table. Photo: picture alliance/dpa/dpa-Zentralbild | Hans-Jürgen Wiedl

Be aware that if you are registered as this kind of freelancer, you must include the following sentence in your invoices: ‘Gemäß § 19 UStG wird keine Umsatzsteuer berechnet’ which means ‘In accordance with Paragrah19 of the German VAT law, no VAT has been added to this invoice.’

READ ALSO: Everything you need to know about your German tax return in 2022

If you think you will earn more than €22.000 per year, you will need to pay Umsatzsteuer (VAT) and will have to submit tax declarations in advance and more often. Depending on how much you earn, this could be every month or every quarter. 

5. Get your insurance in order

In Germany, it’s a legal requirement to have health insurance.

If you’ve just made the move from employment to being a freelancer and want to keep the same health insurer, you should get in contact with your health insurance provider straight away to tell them about your change of circumstances. They will ask you to re-register and to tell them your projected freelance earnings for the year, so they can amend your monthly fees.

If you don’t keep your health insurer provider updated, you could continue to be charged the higher rate that you had from your previous salary.

The insurance cards of the health insurance companies DAK, AOK, Barmer and Techniker-Krankenkasse TK lie with euro notes under a stethoscope. Photo: picture alliance / dpa | Daniel Karmann

It’s not just health insurance you need to think about as a freelancer. It’s also wise to think about protecting yourself from any sort of claims that could arise as a result of any working mishaps. 

If, for example, you lose your laptop which contains confidential client information, you need to be protected against claims.

That’s why it’s good to have both Betriebshaftversicherung (business liability insurance) and Rechtschutzversicherung (legal protection insurance).

6. Plan your time wisely

All of these bureaucratic obligations take time. So it’s really important that you take account of that when planning your time. For example, planning half a day a week to deal with your invoices, filing, emails to clients, and conversations with authorities can be really beneficial when scheduling your working time. 

7. Grow your network

As a freelancer, networking is absolutely crucial to success. 

Keep an up-to-date profile on websites like LinkedIn and German equivalent XING and keep in contact with anyone you’ve ever worked with, no matter how brief the contact was. 

Having a network is not only about getting more clients, but also about building a support network in your field to exchange advice, tips and generally for your own enrichment. 

Participating in workshops related to your field, going to seminars, and meet-ups, can be great ways of broadening your network.