Please note: advisory meetings and the service itself are provided in Hebrew only. These guides are here so you can read and understand the topic in your own language.
A study fund (קרן השתלמות) is a savings channel with significant tax benefits, which is why it is one of the most common sources of equity in Israel.
Why is it so worthwhile?
- The employer contributes to the fund, usually more than the employee.
- A tax benefit on the gains – under the conditions set by law, the gains are exempt from capital gains tax on withdrawal.
- Liquidity – after a defined savings period (usually 6 years) you can withdraw for any purpose.
When does it become liquid?
The basic rule: after 6 years from the start of deposits. There are situations in which you can withdraw earlier, for example for professional training or at a certain age, according to the law and the fund's terms.
Should you withdraw the money for an apartment?
An important question. On the one hand, it is money available for equity. On the other hand, if you leave the fund in place, it keeps accumulating tax-free. Consider: - How much equity is really missing? - Are there other sources? - What is the cost of the alternative (a larger mortgage)?
Elia's tip: Before withdrawing a study fund, check which investment track it is in. If the money is needed for an apartment soon, consider a more conservative track so you are not hurt by a market drop just before the withdrawal.
More: saving for equity, how much equity you need.
This article is general information and is not personal advice or a commitment. Rules, interest rates and taxes change from time to time, so check the current situation and your own figures before any decision.