The old-age pension concept in Switzerland is based on three pillars:

1. The state insurance "old-age- and survivor's insurance" (OASI) lies at the basis of the pension provision. Everyone receives this pension. Compared to the last salary received before retirement, it is higher for low-paid employees than for high-paid employees.

2. The occupational pension system provision is aimed to provide additional income to supplement the state pension after retirement, thus guaranteeing a higher living standard. The state and occupational pensions should thus give pensioners an income of approx 60% of their pre-retirement salary.

3. The voluntary private pension porofvision contains any savings that have been made before retirement. There are certain tax advantages to this system (e. g. pillar 3a).

The OASI secures subsistence. It is a contribution based pension system. This means that pensions are financed by contributions made by the younger generation for the benefit of pension recipients. Contributions have to be paid by everyone above the age of 18, respectively 21 years. Any benefits received when retired depend basically on the income prior to retirement, but are capped: they currently lie at CHF 2'390 per month for singles, and by CHF 3'585 per month for married couples. This amount hardly covers subsistence. Supplementary benefits can fill the gap.

The occupational pension provision secures a certain living standards when retiring. It is based on a funded scheme: The benefits depend on the savings made during employment, the higher the contributions, the higher the pension. The occupational pension has a statutory minimum level: yearly earnings of up to CHF 86,040 (2021) have to be insured; for additional earnings above this amount, there is no mandatory insurance. Contributions are compulsory from the age of 25 until statutory retirement age. On one hand, savings are made through monthly contributions. In addition, it is possible for insured persons to make supplementary contributions, depending on their financial situation, for instance by buying into the Pension Fund or by increasing monthly contributions. The second pillar also provides benefits in cases of invalidity or death. Assets of the occupational pension provision can also be used for acquisition of a property or to finance self-employment.

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The 3rd pillar is a private pension provision. It secures additional money on retirement. There are two types of private pension provision, the restricted private pension 3a which is tax-deductible and the unrestricted pension 3b:

Contributions made to the restricted Pension 3A, are income-tax deductible up to a yearly defined amount (currently CHF 6,883). These investment options are regulated similar to those in the occupational pension provision. Assets from pillar 3a can be transferred as purchases into the Pension Fund.

The unrestricted pension provision 3b includes any insurances or savings such as liquidity reserves and assets that do not fall into the category 3a. Tax advantages depend on the type of savings made. There are no limits as to investments made and capital can be withdrawn at any time, even before retirement.

As various risks relating to pension provisions and investments are covered by various service providers, it might prove difficult to keep an eye on everything: Who pays whom in which instance and for how long? Are my next of kin adequately covered?

We can oversee your provisions and investments and help you to find the best solution; tailor-made for your individual situation and needs.