Since 2024, the Czech Republic has two tax-advantaged retirement savings products: the long-standing Supplementary Pension Savings (DPS) and the newer Long-term Investment Product (DIP). Both have pros and cons — and most clients I advise well end up with both.

Quick comparison

DPS — who it's for

DPS has one huge advantage: state contribution. When you contribute 1 700 CZK/month, the state adds another 340 CZK = 4 080 CZK/year. That's a 20% instant "return" before you've invested anything. You won't find that bonus anywhere else.

Downside? DPS portfolios are typically conservative — lots of bonds, less stock exposure. Expected returns 3–5% per year. For younger people with 30+ years ahead, that's relatively low compared to what a stock ETF would deliver.

DIP — who it's for

DIP doesn't get state contribution, but offers free investment choice. You can set up a portfolio of 100% global stock ETF (VWCE, iShares MSCI World etc.) which historically returns 7–9% per year.

Second strength — tax relief. You can deduct up to 48 000 CZK per year from your tax base for DIP contributions. At 15% income tax, that's 7 200 CZK saved yearly. Over 20 years, that's 144 000 CZK of free money.

Ideal combination for most clients: DPS at 1 700 CZK/month (for state contribution) + DIP at another 2 000–5 000 CZK/month (for tax relief and stock returns). Together, maximum benefits the state offers.

Common mistakes