Save Today. Relax To­mor­row.

The 1st pil­lar (gov­ern­ment pen­sion) aims to provide a basic stand­ard of liv­ing for re­tir­ees and dis­abled in­di­vidu­als, and their sur­viv­ors. It con­sists of old age and sur­viv­ors’ in­sur­ance (AHV), dis­ab­il­ity in­sur­ance (IV) and sup­ple­ment­ary be­ne­fits (EL), form­ing the basis of the three-​pillar sys­tem. As a gen­eral rule, the 1st pil­lar is man­dat­ory for every­one who lives or works in Switzer­land.

Since the 1st pil­lar only provides a basic stand­ard of liv­ing, Switzer­land in­tro­duced the 2nd pil­lar, oc­cu­pa­tional pen­sions, on Janu­ary 1, 1985. To­gether, the 1st and 2nd pil­lars provide 60 per­cent of your final salary so that you can main­tain the life­style to which you are ac­cus­tomed. The leg­ally re­quired min­imum is called a “man­dat­ory oc­cu­pa­tional pen­sion.” How­ever, pen­sion funds can provide ad­di­tional be­ne­fits known as “extra-​mandatory pen­sion” be­ne­fits. To en­sure that your pen­sion cov­er­age is main­tained dur­ing peri­ods when you are not a mem­ber of a pen­sion fund, your pen­sion fund as­sets must be trans­ferred to a ves­ted be­ne­fits in­sti­tu­tion.

1st and 2nd pil­lar plans provide 60 per­cent of your final salary when you re­tire – but only up to CHF 85,320. With a 3rd pil­lar plan, you can set aside extra funds to bridge any re­main­ing short­falls in order to enjoy life after re­tire­ment without fin­an­cial wor­ries.