For a couple with a marginal tax rate (TMI) of 30%, every euro deducted from taxable income generates 30 cents in tax savings. Multiplied by regular contributions to a PER over 20 or 25 years, this tax lever can represent more than 70,000 euros in cumulative tax savings. Combined with a well-structured life insurance policy, it allows them to aim for financial assets close to one million euros at retirement. The case of Sophie and Marc illustrates this strategy, accessible to many couples in France.
Sophie and Marc's profile: a highly taxed working couple
Sophie, 38, is a human resources manager at a large industrial group in the Lille area. Her net taxable annual income is 52,000 euros. Marc, 40, is a software engineer on a permanent contract at a digital services company, with a net taxable income of 48,000 euros per year. Married under the community property regime for 12 years, they file jointly with a combined taxable income of 100,000 euros.
The couple has two children: Arthur, 9, and Louise, 6 (giving them 2.5 tax shares with the half-share for two children). Their marginal tax rate (TMI) is 30%. They currently pay approximately 11,500 euros in income tax per year, withheld at source each month -- roughly 960 euros per month.
Sophie and Marc find this tax burden excessive and are seeking legal ways to reduce it while preparing for the future. They long hesitated between investing in rental property (Pinel scheme, LMNP) and optimizing through financial wrappers. After analysis, they chose the PER + life insurance combination, which is more flexible and less constraining than real estate.
Their current assets
- Primary residence valued at 380,000 euros (remaining mortgage: 140,000 euros, monthly payment: 1,100 euros/month, 10 years left)
- Regulated savings accounts: 45,000 euros (Livret A and LDDS at maximum for each spouse)
- Life insurance at Boursorama Vie opened in 2019: 35,000 euros, 100% in euro funds (2024 return: 2.70%)
- Marc's employee savings plan (PEE): 22,000 euros
- No PER
Their clearly defined objectives
- Significantly reduce their income tax, going from 11,500 to 8,000-9,000 euros per year
- Prepare for retirement with a 22 to 25-year horizon, aiming for supplementary income of 1,500 euros per month
- Diversify their investments beyond euro funds, which can no longer sustainably beat inflation
- Maintain a readily accessible cash reserve for emergencies (home improvements, car, holidays)
The strategy implemented: PER + life insurance
Step 1: Open a PER for each spouse and maximize the tax deduction
The PER contribution deduction ceiling is equal to 10% of net professional income, up to a maximum of 10% of 8 times the PASS (approximately 37,094 euros in 2026). In practice, Sophie can deduct up to 5,200 euros per year, and Marc up to 4,800 euros per year.
Sophie opens a PER at Linxea Spirit PER, Marc opens his at Placement-direct Vie PER. The couple decides to contribute:
- Sophie: 5,000 euros per year on her PER (i.e., 416 euros/month in scheduled contributions)
- Marc: 4,500 euros per year on his PER (i.e., 375 euros/month in scheduled contributions)
Worked example: immediate tax savings from the PER
- Annual PER contributions for the couple: 5,000 + 4,500 = 9,500 euros
- Household TMI: 30%
- Annual tax savings: 9,500 x 30% = 2,850 euros
- Tax before PER: 11,500 euros/year
- Tax after PER: approximately 8,650 euros/year
- Tax bill reduction: nearly 25%
In other words, the couple actually spends only 6,650 euros to invest 9,500 euros in their PERs. The remaining 2,850 euros are effectively financed by the government through the tax saving. That is an immediate guaranteed return of 30%, before the funds are even invested in the markets.
Step 2: Restructure the existing life insurance at Boursorama Vie
The 2019 life insurance policy, invested 100% in euro funds, returns approximately 2.70% net (2024 rate). With a 20+ year horizon before retirement, this allocation is far too conservative. The couple carries out a gradual reallocation toward a diversified mix:
- 40% in Boursorama Vie euro funds (14,000 euros): secure foundation, 2024 return of 2.70%
- 35% in Amundi MSCI World ETF (12,250 euros): long-term growth, 0.18% fees
- 15% in SCPI Iroko Zen within the life insurance (5,250 euros): 2024 return of 7.12%, compounding tax-free
- 10% in Amundi Euro Aggregate Bond ETF (3,500 euros): diversification and stabilization
The estimated overall return rises from 2.70% to approximately 5% net of fees, a gain of 2.3 percentage points per year. Over 20 years, this optimization will represent more than 50,000 euros in additional gains.
Step 3: Set up regular contributions to the life insurance
In addition to the PERs, Sophie and Marc schedule monthly contributions to their Boursorama Vie life insurance:
- 500 euros per month with the same diversified allocation (40% euro funds, 35% global ETF, 15% SCPI, 10% bonds)
Unlike the PER, this contribution offers no tax deduction at entry but guarantees a much more flexible exit. Life insurance is accessible at any time, with no withdrawal restrictions. It is the complementarity of both wrappers that makes the overall strategy so powerful.
Step 4: Optimize the beneficiary clauses
Sophie and Marc update the beneficiary clauses of their respective policies. Each designates: "My spouse, failing that my children born or to be born in equal shares, failing that my heirs." This standard wording protects the surviving spouse while providing for the children as second-tier beneficiaries.
For the larger policies over time, the couple will consider a split beneficiary clause (usufruct to the spouse, bare ownership to the children) to optimize the transfer at the second death.
The numbers: projections at 10, 20 and 25 years
PER component (total contributions of 9,500 euros per year)
Assumptions: average net return of 5%, constant contributions over 22 years (until Sophie turns 60).
| Horizon | Cumulative contributions | Estimated value | Capital gains | Cumulative tax savings |
|---|---|---|---|---|
| 10 years | 95,000 € | 125,800 € | 30,800 € | 28,500 € |
| 20 years | 190,000 € | 334,200 € | 144,200 € | 57,000 € |
| 25 years | 237,500 € | 496,300 € | 258,800 € | 71,250 € |
At Marc's retirement (age 65, in 25 years), the couple's cumulative PER capital could reach approximately 496,000 euros. The total tax savings realized at entry would amount to 71,250 euros, a considerable lever that financed a significant portion of their savings effort.
Life insurance component (500 euros/month + existing capital of 35,000 euros)
Assumptions: average net return of 5.2% (diversified allocation).
| Horizon | Cumulative contributions | Estimated value | Capital gains |
|---|---|---|---|
| 10 years | 95,000 € | 130,400 € | 35,400 € |
| 20 years | 155,000 € | 322,700 € | 167,700 € |
| 25 years | 185,000 € | 479,800 € | 294,800 € |
Overall financial picture at 25 years (Marc's retirement)
- Couple's PER: approximately 496,000 euros
- Life insurance: approximately 480,000 euros
- Total financial savings: approximately 976,000 euros
- Total tax savings via PER: 71,250 euros
- Primary residence: mortgage paid off for 15 years, estimated value 480,000 euros
The couple will have invested a total of approximately 422,500 euros (PER + life insurance) for financial assets approaching one million euros, nearly multiplying their savings effort by 2.3 thanks to compound interest and reinvested tax savings.
The PER and life insurance combination: why both wrappers are essential
| Criterion | PER | Life insurance |
|---|---|---|
| Tax advantage at entry | Yes: deduction from taxable income | No |
| Fund availability | Locked until retirement (with exceptions) | Available at any time |
| Tax treatment at exit | Capital: income tax scale / Gains: 30% flat tax | After 8 years: 9,200 € allowance (couple) then 7.5% |
| Early withdrawal cases | Primary home purchase, disability, spouse death, over-indebtedness | No restrictions |
| Transfer on death | Subject to standard inheritance rules | 152,500 € allowance per beneficiary |
| Ideal for | High TMI, retirement objective | Flexible savings, estate planning, projects |
The strength of Sophie and Marc's strategy rests on this perfect complementarity:
The PER offers an immediate tax advantage (deduction at entry) but imposes constraints: funds are locked until retirement (except in exceptional cases such as purchasing a primary home, death of a spouse, disability, or exhaustion of unemployment benefits) and capital withdrawals are subject to income tax. It is the ideal wrapper for savings you are certain not to touch before retirement.
Life insurance offers no advantage at entry but shines at exit: after 8 years, withdrawals benefit from a 9,200 euro annual allowance for a married couple (on gains only). Moreover, funds remain accessible at any time, and the estate planning framework is highly advantageous. It is the ideal wrapper for high-performing precautionary savings and projects with a variable time horizon.
Tax treatment at exit: detailed retirement simulation
At 62, Sophie and Marc retire with a combined pension of 3,800 euros net per month. Their TMI drops to 11% (the couple's taxable income is approximately 45,000 euros, in the 11% bracket). They need an additional 1,200 euros per month to maintain their standard of living.
Via life insurance: scheduled withdrawals of 800 euros per month from the Boursorama Vie policy, which will then have over 24 years of tax maturity. On these withdrawals, gains represent approximately 50% of the policy value. That means 400 euros of gains withdrawn per month, or 4,800 euros per year. After the 9,200 euro allowance, no income tax is owed. Only the 17.2% social contributions apply on gains, amounting to approximately 825 euros per year (69 euros/month). Tax cost: negligible.
Via the PER: fractional capital withdrawals of 400 euros per month (4,800 euros/year). This amount is taxed as income, but at an 11% TMI, that represents only 528 euros in annual tax (44 euros/month). Gains are subject to the 30% flat tax, but they are modest relative to the capital contributed.
The real tax benefit of the PER: the TMI differential
The true benefit of the PER lies in the gap between the TMI at entry (30% during working life) and the TMI at exit (11% in retirement). On 9,500 euros of annual contributions:
- Savings at entry: 9,500 x 30% = 2,850 euros/year
- Tax at exit: 9,500 x 11% = 1,045 euros/year
- Net annual gain: 1,805 euros
Over 25 years of contributions, this differential represents a real tax gain of 45,125 euros, in addition to the returns generated by the invested capital.
Catching up on unused PER ceilings
The couple discovered a lesser-known opportunity: unused PER deduction ceilings from the three preceding years can be carried forward. Since 2019, neither Sophie nor Marc had opened a PER. They therefore have cumulative unused ceilings representing approximately 30,000 euros (3 years x 10,000 euros average ceiling for the couple).
They make an exceptional contribution of 8,000 euros in the first year to begin catching up on this backlog, generating an additional tax saving of 8,000 x 30% = 2,400 euros. This contribution is split between the two PERs and is in addition to regular contributions.
The mistakes Sophie and Marc avoided
Not contributing beyond their PER ceiling
Some couples contribute more than their deductible ceiling, thereby losing the main tax advantage of the PER. Excess contributions are not deductible and will still be taxed at exit on the gains portion. Sophie and Marc check their available ceiling each year (shown on the tax notice, boxes 6NS, 6NT, 6PS and 6PT) and adjust their contributions accordingly.
Not neglecting liquidity
By keeping 45,000 euros in regulated savings accounts and contributing to life insurance alongside the PER, the couple maintains significant immediate withdrawal capacity. The PER alone would have created a risky "tunnel effect": all the money would be locked until retirement, with no possibility of withdrawal in case of hardship (except for legally specified cases).
Not staying 100% in euro funds
With a 20+ year horizon, a 100% euro fund allocation at 2.70% would represent a considerable opportunity cost. Diversification into equity ETFs and SCPI adds short-term volatility but offers a much higher expected return over the long term. The difference between 2.70% and 5% net over 25 years, for 500 euros/month, represents approximately 180,000 euros in additional gains.
Watch out when pooling PER ceilings
To pool the couple's PER ceilings (using one spouse's ceiling for the other's contributions), you must check box 6QR on the income tax return. Without checking this box, each spouse can only use their own ceiling. Sophie and Marc never forget to check this box each year.
Key takeaways
The case of Sophie and Marc illustrates the power of combining life insurance and PER for a couple in the 30% tax bracket:
- The PER generates an immediate tax saving of 2,850 euros per year, nearly a 25% reduction in the tax bill
- Life insurance offers flexibility and optimal tax treatment at exit (9,200 euro allowance for a couple after 8 years)
- The complementarity of both wrappers covers all scenarios: retirement, projects, emergencies, estate planning
- With a total savings effort of 1,290 euros per month (791 euros PER + 500 euros life insurance), the couple aims for financial assets close to one million euros at retirement
- The TMI differential between entry (30%) and exit (11%) generates a cumulative real tax gain of more than 45,000 euros
- Online policies (Linxea Spirit PER, Placement-direct Vie PER, Boursorama Vie) minimize fees and maximize net returns
The key point: tax optimization is not limited to a single product. It is the intelligent combination of multiple wrappers, each playing a specific role, that maximizes the final result in terms of both tax reduction and wealth building.
This article is published for informational purposes and does not constitute personalized investment advice. Past performance does not guarantee future results. Projections are based on return assumptions that may not materialize. PER deduction ceilings and tax brackets change every year. Before making any investment decision, consult a qualified financial advisor.