What is the 3rd pillar?
The 3rd pillar represents individual pension provision in the Swiss system. It is divided into two categories:
1. Pillar 3a (tied pension provision): mainly intended for retirement provision, it offers tax advantages but imposes certain withdrawal conditions.
2. Pillar 3b (unrestricted pension provision): more flexible, allowing more flexible use of the savings accumulated.
AXA 3rd pillar solutions
AXA structures its offer around three distinct plans, each designed to meet different objectives.
1. SmartFlex Pension Plan (3a/3b)
The principle is based on regular contributions starting from CHF 600 per year (or CHF 50 per month) and up to the maximum 3rd pillar limit. This accessibility makes it possible to start early, even with a limited budget. The minimum duration is 7 years for the 3a pillar and 10 years for the 3b pillar.
Flexible premium allocation is the central element of SmartFlex. With each payment, you decide how to divide your premium between 2 compartments:
1. The secure capital functions like a traditional savings account. Your money is legally guaranteed at 100% within AXA’s tied assets. It earns a technical interest rate (currently 0% according to the provided offer) plus a potential variable surplus interest (projected at 1.50% in the moderate scenario). The drawback: potentially limited returns over the long term.
2. The performance-oriented capital is invested in equities through diversified funds. You benefit from financial market growth and historically higher returns. The capital is guaranteed up to the current value of the fund units. The advantage: higher return potential driven by equity markets. The drawback: short-term fluctuations depending on market movements.
Key features
- Recurring premium from CHF 600 per year
- Minimum term of 7 years for 3a, 10 years for 3b
- Death and disability coverage included
- Tax benefits and estate privileges
2. SmartFlex Capital Plan (3a/3b)
The AXA SmartFlex Capital Plan is an investment solution under the 3a pillar (transfer only) and 3b pillar that combines performance, security, and flexibility. You can freely decide what portion of your capital is invested in equities to seek returns and what portion remains securely placed at a preferential rate currently set at 2.2%. This allocation can be adjusted at any time, free of charge.
One of the great advantages of SmartFlex is its tax benefits: dividends and interest are not subject to income tax if the conditions of Pillar 3b are met. In the event of death or bankruptcy, the capital also benefits from legal protection, as it is excluded from the estate and protected from creditors. Thanks to very low fund charges, similar to those of large institutional investors, the potential return is more attractive than on a conventional savings account.
You can strengthen the security of your investment by activating, free of charge and at any time, options such as staggered investment management (to smooth out market entry risks), gain protection, or the progressive reallocation of capital towards the end of the contract.
Key features
- Minimum single contribution of CHF 15,000 for 3a, CHF 25,000 for 3b
- Duration between 10 and 30 years
- Retirement provision with minimum death cover
- Receipt of capital at maturity
3. SmartFlex Income Plan (3b only)
The AXA SmartFlex Income Plan is designed for those who wish to turn a single lump sum into regular income while maintaining full control over their savings. You make an initial contribution of CHF 15,000 or more and define the amount, frequency, and duration of the payments you wish to receive. If your needs change, the contract remains flexible — you can adjust both the withdrawals and the capital allocation at any time.
The investment is divided into two parts. The secure capital earns a fixed preferential rate and is 100% protected in the event of AXA’s insolvency. The performance-oriented capital, on the other hand, is invested in diversified equity funds according to the investment theme you choose.
Key features
- Minimum single contribution of CHF 15,000
- Duration between 10 and 30 years
- Preferred interest rates
- Plannable monthly income
Comparison of the three AXA plans
- Criteria
- Pension plan
- Capital Plan
- Income Plan
- Main objective
Savings + protection
Placement
Regular income
- Financing
Periodic premium
Lump sum
Lump sum
- Type of plan
3a/3b
3a (transfer)/3b
3b
- Risk insurance
Yes
No
Four investment themes available
- World - Replicates the MSCI ACWI index (2,558 companies, 47 countries). Low-cost passive management (0.16%/year). High exposure to the United States (65%), followed by Japan (4.9%), the United Kingdom (3.4%) and China (3.2%). Main sectors: technology (23%), finance (18%) and consumer (11%). Ideal theme for global diversification.
- Switzerland - Invested in major Swiss companies (Nestlé, Novartis, Roche). Offers familiar but geographically and sectorally concentrated exposure. SPI historical performance: +7.2%/year over 25 years.
- Durability - Selection of ESG-compliant companies, excluding tobacco, weapons, coal, oil and gas. Combines ethical values with competitive returns.
- Future trends - Focus on innovative sectors (AI, renewable energies, digital healthcare). Riskier in the short term, but high potential in the long term.
What are AXA's 3rd pillar fees?
The AXA SmartFlex plan also stands out for its cost structure — clear and relatively competitive. Fund fees vary depending on the chosen investment theme, ranging from 0.16% to 0.39% per year, with no entry or exit commissions applied. When adding the contract’s management and administrative costs, the total expense typically averages around 1 to 1.5% per year, depending on the plan’s configuration and duration. In all cases, the fees related to the contract are clearly stated in the offer.
This is a low level for an insurance-based retirement product, especially compared to other 3a solutions on the market that often exceed 2%. In practice, AXA manages to keep these costs contained thanks to a largely passive and institutional management approach.
Conclusion
AXA’s SmartFlex positions itself as a modern and efficient retirement solution, designed for those who want to grow their savings without giving up flexibility. By combining adaptability, tax advantages, security options, and controlled costs, this plan successfully bridges the gap between traditional insurance and pure investment.
The result is an intelligent hybrid product: sufficiently secure for retirement provision, yet performing well enough to generate real long-term capital growth. For those looking for an alternative to the classic 3a account, and who want to retain control over their allocation between security and yield, SmartFlex is clearly one of the most coherent options on the Swiss market today.
Frequently asked questions
AXA’s 3rd pillar is aimed at anyone looking to build capital over the long term while benefiting from a favorable tax framework.
It is particularly well suited for those who wish to prepare for retirement proactively, protect their loved ones in the event of death, or simply invest in a disciplined way. Thanks to its flexibility, SmartFlex adapts equally well to young professionals, self-employed individuals, or families seeking a balance between security and performance.
The difference between 3a and 3b is as follows:
- Pillar 3a is linked to occupational pension provision: deposits are tax-deductible, but withdrawals are restricted by law (retirement, property purchase, independence, etc.).
- Pillar 3b, However, the money remains accessible at all times, and some solutions (such as SmartFlex 3b) offer inheritance benefits and protection in the event of bankruptcy.
In all cases, compare the 3rd pillars will help you find the solution that's best for you.
Returns depend on the proportion invested in yield-oriented capital (equities) and the investment theme chosen. Historically, SmartFlex funds have posted solid performances: the «World» theme, for example, has generated over 88% in returns (+10% annualized) since its launch in 2019. This fund has even outperformed its benchmark of 86.27. Naturally, results vary according to market and investment horizon.
Absolutely. You can switch from one theme to another, for example from «World» to «Sustainability», free of charge, at any time.
The minimum annual premium is around CHF 600 for versions 3a and 3b. For the SmartFlex income plan, the initial contribution must be at least CHF 15,000.
Historically, equity investments have delivered higher long-term returns than so-called “safe” assets such as bonds or savings accounts. If you have more than 15 to 20 years before retirement, allocating a portion to equities is often recommended to generate stronger returns.
The key is to adjust the allocation to your risk profile and gradually reduce the equity portion as you approach retirement.
In the event of a loss of earning capacity, AXA provides a premium waiver.
In practical terms, if you become unable to work due to illness or an accident, AXA steps in and continues paying the premiums on your behalf, ensuring that your retirement plan remains fully intact.
It works as follows:
- As soon as a loss of earning capacity of at least 25% is recognized, AXA covers a portion of the premiums.
- If the disability reaches 66 % or more, you are completely free of premium payments.
- The waiting period before coverage begins depends on the contract (3, 6, 12, or 24 months, depending on your selection).
During this period, your SmartFlex plan continues to function normally: savings remain invested, guarantees remain in force, and you do not lose your tax benefits or your protection in the event of death.
The reality of the Swiss system: a balance under strain
The Swiss pension system, with the OASI, the occupational pension (LPP) and the third pillar (pillar 3a or 3b), is built on a simple principle: sharing the risks between the state, the employer, and the individual. Today, however, that balance is weakening. The OASI faces a demographic imbalance — there are more retirees and fewer active workers. The LPP, meanwhile, depends on market returns and on declining technical and conversion rates. The result: what once seemed “guaranteed” no longer truly is.
By combining OASI + LPP, most Swiss retirees receive around 60% of their final income — and that’s simply not enough to maintain the same standard of living. Private pension planning therefore becomes your only real lever to fill this gap, reduce your taxes, and keep control over your financial future.
Before age 30: laying the foundations
Before age 30, it’s not about saving a fortune or calculating your future pension down to the cent. The key is to understand the system and lay the foundation early. Opening a pillar 3a account as soon as possible is a simple but decisive step. Even small amounts, invested regularly, benefit from a long investment horizon and the compounding effect of returns. For a young investor, a fully fund-based solution can be considered — depending, of course, on their risk profile.
The pillar 3b remains an option for more flexible investments, without a strict tax framework. If you don’t yet have a family or major financial responsibilities, a bank-based pillar 3a is usually sufficient. However, an insured pillar 3a offers additional protection: in the event of an accident or illness leading to a loss of earning capacity, the insurance may provide an income or activate a premium waiver — meaning it will continue saving on your behalf. These early years are when capital must be built. If one day you are unable to work, you will no longer be able to save and will depend solely on the OASI, the LPP or the LAA — and therefore on very limited income.
From 30 to 40: implementing a strategy
Between ages 30 and 40, your situation begins to stabilize: income increases, your career takes shape, and major expenses (housing, family, debts) become more predictable. This is the ideal time to start planning your retirement seriously. Time is still on your side, and every franc invested now will work for you over the next two to three decades. The pillar 3a should become an annual habit, not a last-minute option at the end of the year.
At this stage, you can go further: compare the returns of your pension fund (LPP), consider BVG/LPP buy-backs to reduce taxes, and diversify the 3rd pillar according to your profile. A more dynamic portfolio, with a portion in funds or equities, is justified if the horizon remains long. The aim is no longer simply to “put money aside”, but to make the most of it. capital growth.
The 30s and 40s are when everything comes into play: financial discipline, clarity of priorities, and the awareness that the Swiss system will not be enough to guarantee your standard of living. This is the time when you stop “thinking about retirement” and start building it.
After 45: regaining control
After age 45, Retirement is no longer a distant concept. It's becoming a concrete deadline. You can't always make up for the mistakes of youth, but there's still time to regain control. Visit revenues are often at their maximum, children are more independent, and financial visibility is better. Now is the time to adjust strategy and fill any gaps.
The priority: reduce debt and maximize profits 3rd pillar contributions. Visit BVG/LPP buy-backs become a powerful tool for reducing the tax burden while increasing future income. At this age, the focus is less on performance and more on solidity. balance between safety and performance, depending on the retirement horizon.
It's also a good time to take stock: how much have I really accumulated? What pension can I expect from the AHV and BVG schemes? If the result is below my desired standard of living, it's better to know now than in ten years' time. Being clear-headed at 45 avoids regrets at 65.
60: optimizing your later years
From age 60, Financial planning becomes a matter of fine-tuning. The big decisions have been made, the capital has been built up, but now it's a matter of deciding how to go about it. transform this heritage into a stable, tax-efficient income. These last years before retirement require rigor, not risky gambling.
The time has come to gradually reduce the proportion of equities and to steer investments towards greater stability. The objective is no longer capital growth, but preservation of purchasing power and security of future income. At the same time, you need to plan your withdrawal from the 2nd pillar (LPP): annuity, capital or combination, and organize your exit from the 3rd pillar (LPP). step by step to limit the tax burden. Depending on the canton, spreading the payment over several years can considerably reduce the tax burden. Visit semi-retirement can also offer an interesting compromise: maintaining partial activity while lightening the pace and testing the new financial reality.
It's also a good time to review the essentials: health cover, post-retirement taxation, inheritance and any mortgages. The objective is clear: secure your assets, stabilize your income and anticipate future needs. Masterful planning at this stage ensures that every franc accumulated really does serve your comfort and independence.
Conclusion
Retirement planning is not a question of age, but of conscience. In Switzerland, the system remains solid, but it no longer guarantees the same level of comfort as in the past. AVS and LPP cover around 60 % of final income, provided you have a full and uninterrupted career. The rest is up to you: your discipline, your strategy and when you decide to act.
Before the age of 30, you need to understand and get started. Between 30 and 40, build. After 45, adjust. And from age 60, secure. Each stage has its own logic, but all are based on the same idea: don't suffer, choose.
The earlier you start, the more control you have over your future. And when it comes to retirement, control is worth more than hope.
Our pension advisors will work with you to define a strategy tailored to your profile, your goals and your life horizon. Together, we can turn your retirement planning into a clear, concrete and worry-free project.
Frequently asked questions
As soon as possible. Ideally, from your first job. By opening a Pillar 3a early, you can benefit from capitalization over several decades. Even small amounts invested regularly make a real difference over the long term.
The early retirement is prepared at least 10 to 15 years in advance. Retirement before the legal retirement age means a reduction in AHV and BVG pensions, as well as a significant loss of income if private savings are insufficient. The earlier you take the decision, the more scope you have to compensate for these losses, in particular by increasing Pillar 3a payments or making targeted BVG purchases.
In a nutshell: if you're planning to retire at 60, start planning at 45-50 at the latest.
The differences between 3a and 3b are as follows:
On average, the’AVS and LPP cover about 60 % of your last income. This rate varies according to the length of your career in Switzerland, your salary and the performance of your pension fund. To maintain your standard of living, the 3rd pillar or other private investments are essential.
It all depends on your situation.
- Annuities offer lifelong security, but no flexibility and no inheritance.
- Capital gives more freedom, but requires good management.
Often, a combination of the two is the most balanced solution.
Several levers are available:
- Open several 3a pillars to make withdrawals over several years.
- Buying back BVG years no later than 3 years before departure to reduce taxable income.
- Planning where to live (some cantons are more tax-efficient when you retire).
Historically, equity investments have delivered higher long-term returns than so-called “safe” assets such as bonds or savings accounts. If you have more than 15 to 20 years before retirement, allocating a portion to equities is often recommended to generate stronger returns.
The key is to adjust the allocation to your risk profile and gradually reduce the equity portion as you approach retirement.
With an insured 3a, the saver is protected: in the event of accident or illness resulting in disability, the insurer takes over - paying an annuity or waiving premiums, i.e. contributions continue without you having to pay them. In contrast, a bank 3a policy does not cover this risk.
Yes, but only if you continue to work. AVS, LPP and 3rd pillar contributions can be continued within certain limits. This makes it possible to slightly increase your future pension and defer the 3a tax.
Many people in Switzerland lose track of part of their occupational pension savings. With frequent job changes, career breaks, or moves abroad, it’s common for assets from the 2nd pillar to remain “asleep” in forgotten accounts. This is where the 2nd Pillar Central Office comes in — a national body linked to the LPP Guarantee Fund, responsible for helping individuals locate unclaimed LPP/BVG assets. Acting as a bridge between insured persons and pension institutions, it ensures that every franc contributed ultimately reaches its rightful owner.
What is the 2nd Pillar Central Office?
The 2nd Pillar Central Office, established in 1999 and managed by the LPP Guarantee Fund in Bern, is a public service that helps insured persons find forgotten occupational pension assets.
It acts as a national point of contact within Switzerland’s occupational pension (LPP/BVG) system, ensuring that anyone who has worked in Switzerland can trace and recover the pension funds they are entitled to.
Unlike a pension fund, the 2nd Pillar Central Office does not hold any assets and does not pay out benefits. It should not be confused with the Substitute Occupational Benefit Institution (LPP), which safeguards pension funds when an insured person has not designated a new pension provider.
How does the 2nd Pillar Central Office work?
To recover any forgotten pension assets, insured persons can submit an official request directly on the LPP Guarantee Fund’s website (sfbvg.ch). The 2nd Pillar Central Office then compares the personal data provided (name, date of birth, AHV number) with the information reported by pension funds.
If a match is found, both the individual and the relevant pension institution are informed. The service is free of charge, confidential, and available in multiple languages, ensuring easy access for all insured persons.
The 2nd Pillar Central Office does not hold individual accounts and does not manage any assets. It performs no financial transfers — its role is limited to providing information and connecting the insured person with the appropriate pension fund.
How does the 2nd Pillar Central Office differ from the LOB Guarantee Fund?
The LOB Guarantee Fund and the 2nd Pillar Central Office depend on the same foundation, based in Bern, Eigerplatz 2, but their missions are distinct.
The LOB Guarantee Fund is responsible for ensuring the stability of the Swiss occupational pension system. It intervenes in cases of a pension fund’s insolvency, thereby guaranteeing the payment of the minimum benefits required by law.
The 2nd Pillar Central Office, on the other hand, acts as a liaison service of the LPP Guarantee Fund. It focuses exclusively on individual searches for forgotten pension assets and does not manage any funds or benefits.
Its activities fall under the legal framework of Article 58a of the LPP, which governs the exchange of data between pension funds and the Central Compensation Office.
How can I contact the 2nd Pillar Central Office?
The 2nd Pillar Central Office can be contacted directly through the official website of the LPP Guarantee Fund. There, you will find an easy-to-use online request form to start searching for forgotten occupational pension assets.
Official contact details:
Centrale du 2ème pilier
Fonds de garantie LPP
Organe de direction
Case postale 1023
3000 Berne 14
email: info@zentralstelle.ch
telephone: +41 31 380 79 75 (No information on assets is given over the phone.
Before submitting your request, prepare your OASI number, a list of your former employers, and your employment periods in Switzerland. This information will allow the Central Office to carry out a quick and accurate search within the pension funds’ databases.
Best practices to avoid forgotten assets
Losing track of a pension account is more common than you might think. Here are a few simple reflexes to avoid forgotten 2nd pillar assets:
- Inform your pension fund each time you change job or professional situation.
- Store and centralize your statements LPP in a single file (paper or digital).
- In the event of a break in activity, transfer your assets to a vested benefits account rather than leaving them unattended.
- Last but not least, optimize your BVG/LPP purchases and your pension strategy with the help of a certified advisor, to close any gaps and maximize your tax benefits.
At Invexa, we support you in the search, transfer, and optimization of your LPP assets. We analyze your personal situation and help you recover, consolidate, and grow your pension capital to enhance your retirement plan or long-term projects.
Frequently asked questions
Your 2nd pillar assets are generally held in the pension fund of your current employer. If you changed jobs without transferring your funds, they may have been moved to a vested benefits account or to the Substitute Occupational Benefit Institution (LPP).
To locate your forgotten pension assets, fill out the official form on the 2nd Pillar Central Office website. The service compares your data with that of pension funds and informs you if there is a match. It is free and confidential.
In 2025, the minimum annual salary subject to the LPP is CHF 22,680. Below this threshold, affiliation to the 2nd pillar is not mandatory.
Anyone who has worked in Switzerland, even temporarily, can apply.
The time required depends on the number of institutions to be contacted. In general, the search takes between 4 and 8 weeks, depending on the complexity of the case and the responses of the pension funds concerned.
No, the search carried out by the 2nd Pillar Central Office is completely free of charge and confidential.
If you have changed jobs several times, worked part-time, or left Switzerland, it is possible that some of your capital has remained in a vested benefits account. Use the central service for the 2nd pillar to check.
What is 3rd pillar insurance?
In Switzerland, the 3rd pillar completes the 1st and the 2nd pillar. When taken out in the form of life insurance, it can be retirement savings combined with protection in the event of death or disability, or simply pure risk protection.
In the 3rd pillar system, we distinguish between the pillar 3a, known as the “tied” option, which offers attractive tax deductions but comes with strict withdrawal conditions, and the pillar 3b, known as the “flexible” option, which is more adaptable but generally lacks immediate tax benefits.
An insurance policy in the 3rd pillar not only allows you to prepare for retirementand also to provide security for your family, thanks to guaranteed capital and a clear beneficiary clause.
Contribution limits
In 2025, it will be possible to pay out the following amounts in tied personal pension plans:
- Employees affiliated to a pension fund: Up to CHF 7,258 / year
- Self-employed or employees not affiliated to a pension fund: 20% of income, maximum CHF 36,288
Why take out 3rd pillar life insurance?
Taking out a life insurance policy within the 3rd pillar primarily provides dual protection. You build up regular savings for your retirement while also protecting your loved ones in the event of death or disability. Unlike a standard savings account, the insurance contract guarantees a lump sum or annuity, even if unexpected circumstances occur.
It’s also a tax-efficient choice: in the tied 3rd pillar (3a), the premiums you pay each year reduce your taxable income, providing an immediate benefit. In the flexible 3rd pillar (3b), you enjoy greater flexibility and, depending on the contract and the canton, possible tax exemptions on the payout as well as the ability to deduct premiums up to a certain limit.
Finally, the beneficiary clause allows you to designate in advance who will receive the capital, facilitating the transfer and protecting your heirs.
Things to consider before committing
3.1 Define your objectives and check the fit
Before signing a 3rd pillar insurance contract, it's essential to clarify your priorities. Are you primarily looking to save for retirement, protect your loved ones in the event of death, or combine the two?
The choice between a pillar 3a and a pillar 3b also depends on your personal needs. The 3a is attractive for its tax benefits, but it remains more restrictive when it comes to withdrawals. The 3b, on the other hand, offers greater flexibility—particularly for financing a project or passing on capital—but without the same tax deductions.
Asking the right questions from the outset will help you avoid an overly rigid or ill-adapted contract. Life insurance in the 3rd pillar should be aligned with your life plans and investment horizon, not simply a commercial promise.
3.2 Choosing the right contract
Not all life insurance policies under the 3rd pillar are the same. Some are limited to pure risk coverage — meaning they pay out a lump sum or annuity only in the event of death or disability. Others combine this protection with retirement savings, either through an interest-bearing account or investments in funds, allowing your capital to grow over time.
It is also possible to take out a contract with a head (single-person protection) or two heads (for a couple, for example), to tailor coverage to your family situation. Whether you choose traditional or unit-linked insurance will depend on your investor profile and your risk tolerance.
3.3 Examining costs
A 3rd pillar insurance contract may seem attractive, but the fees behind the scenes often make all the difference. Entry fees, annual management fees, investment fund costs (TER): all these elements naturally reduce the final return on your savings.
Some insurers charge particularly high fees, which can erode a significant portion of your capital over the long term. This is why it’s essential to request a net-of-fees simulation to see the amount actually accumulated over the years.
3.4 Understanding taxation
In the tied 3rd pillar (3a), contributions are deductible from your taxable income up to the legal limit. This reduces your taxes each year and provides an immediate return in addition to your investment performance. When the funds are withdrawn, the capital is taxed separately at a reduced rate.
In the free 3rd pillar (3b), premiums are in principle not tax-deductible (except in certain cantons). On the other hand, the contract offers greater flexibility and, if its provident nature is recognized, the capital paid in may be tax-exempt at the time of withdrawal. Some cantons also allow partial deductions, which can improve the tax appeal of the 3b.
New: 3a redemptions
In 2026, it will be possible to make subsequent 3rd pillar A purchases for the 2025 tax year of CHF 7,258 (ceiling).
3.5 Anticipating exit conditions
A 3rd pillar insurance policy commits you for several years, sometimes until retirement. However, life often brings unforeseen events: a change in professional situation, divorce, the purchase of a home or a move abroad. In such cases, an early withdrawal can be considered, but it almost always entails consequences financial.
Insurers generally apply high surrender charges at the beginning of the contract, which greatly reduces the capital recovered if you leave the contract. too early. The earlier you exit, the greater the loss. Hence the importance of carefully analyzing the withdrawal conditions and any penalties before signing.
Types of 3rd pillar insurance
Not all 3rd pillar insurances are alike. Here are the main forms of life insurance offered under the 3rd pillar.
1. Pure risk life insurance
Pure risk life insurance focuses solely on protection. It has no savings component: you pay a premium to guarantee a capital sum to your loved ones in the event of death, or an annuity in the event of disability.
This type of contract is particularly suitable for families who want to secure their financial future in the event of a setback, without tying up capital in long-term savings. As there is no surrender value, the premium is generally lower than for combined insurance.
1.2 Endowment life insurance
Unlike pure risk, theendowment insurance combines two dimensions: protection and savings. In the event of death or disability, your loved ones receive a lump sum or an annuity. If you reach the end of the contract, you receive the capital you have saved, which has been invested either in an interest-bearing account or in funds.
This type of contract is interesting for those who want to prepare for retirement while benefiting from coverage against unforeseen events. It establishes a long-term savings discipline and offers additional security thanks to the accumulated surrender value.
Endowment life insurance guarantees that you will receive a lump sum at the end of the policy, even if no claim has been made. It's a complete solution for those seeking both protection and retirement savings as part of their 3rd pillar.
1.3 Common variants
In addition to the classic formulas, there are also variants to meet specific needs. Disability insurance protects your income if an illness or accident prevents you from working.
Life insurance with restitution guarantees, as a minimum, reimbursement of premiums paid in the event of premature death. Fund-linked life insurance allows savings to be invested in the financial markets, with a higher potential return but also greater risk. Finally, life or temporary annuities convert capital into a regular income, either for life or for a fixed period, e.g. until retirement.
Frequently asked questions
The difference lies in the fact that the 3rd pillar bank account is simply a savings account, whereas the 3rd pillar insurance account combines savings and protection (death, disability). Insurance offers additional security, but with less flexibility.
Yes, but this often entails substantial surrender charges, especially in the first few years. So it's essential to check the exit conditions before signing.
In 3a, premiums are deductible from taxable income up to the legal limit, and the capital is taxed separately on withdrawal, at a reduced rate. In 3b, there is no deduction at federal level, but the capital may be tax-exempt if the contract meets provident criteria.
Yes, but at a reduced rate at 1/5 of the tax rate, separately from the rest of the income.
You must make Pillar 3a payments no later than December 31 to be tax deductible in the current year.
Pure risk insurance covers only death or disability, while endowment insurance adds a savings component: a capital sum is guaranteed at maturity, even if no claim is made.
Yes, it is possible to modify the beneficiary clause, unless it has been designated as irrevocable. This is crucial to ensure that the capital is passed on to the right person.
What is the 2nd pillar?
The 2nd pillar is mandatory for employees whose annual income exceeds a minimum threshold (CHF 22,680 from 2025). Contributions are shared between the employee and the employer, and paid into a pension fund (pension fund). This savings system is based on the principle of capitalization: the contributions paid in are invested and generate personal assets.
Situations giving right to a withdrawal
Your BVG capital can be withdrawn under several conditions:
- Ordinary withdrawal on retirement (1/4 of minimum compulsory assets)
- Early retirement
- Withdrawal for the purchase of a home as a principal residence
- Definitive departure from Switzerland
- Starting a self-employed business
1. Ordinary retirement
The most common situation is withdrawal at the time of retirement. At the legal age (65 years for both men and women), the insured person can receive their assets in the form of a lifetime pension, a lump-sum payment, or a mix of both if allowed by their pension fund’s regulations. The insured is entitled to withdraw at least 25% of their capital.
The choice to receive all or part of the capital instead of a pension must be made in writing within a deadline set by the pension fund (often 1 to 3 years before retirement). Once this choice is made, it is irrevocable.
2. Early retirement
Most pension funds allow early retirement from 58 years old. In this case, the insured may request an early annuity (with a lower conversion rate), or a lump-sum payment in accordance with the terms of his or her regulations.
Some institutions impose a proportional reduction in benefits for each year of early retirement. In general, early retirement can reduce the conversion rate between 0.10 and 0.30% per year of anticipation.
3. Withdrawal for the purchase of a home as a principal residence
The Swiss Vested Benefits Act (LFLP) allows the use of 2nd pillar funds under the home ownership promotion scheme (EPL), meaning for the purchase, renovation, or repayment of the mortgage on your primary residence. Two options are possible:
- Early withdrawal: part or all of the equity can be used to finance the purchase, construction or mortgage repayment of a home for own use.
- Pledging: the capital remains in the pension fund but is pledged to the bank to increase borrowing capacity.
The property must be used as principal residence (and not as a second home or investment property). Withdrawals are subject to a one-off capital gains tax at a reduced rate.
4. Final departure from Switzerland
If the insured moves to a country outside the European Union or EFTA, they may withdraw their entire LPP assets (both mandatory and supplementary parts). However, if moving to an EU or EFTA country, only the supplementary assets can be withdrawn. The mandatory assets are transferred to a vested benefits account.
Proof of new residence abroad is required (certificate of residence, deregistration from the commune, etc.).
5. Starting a self-employed business
When a person leaves salaried employment to become self-employed, they can request the payment of their pension assets. This withdrawal is only possible within one year after the start of the self-employment activity and provided that this activity is not secondary.
Concrete evidence is required (AHV registration , tax status, etc.).
Taxation of capital withdrawals
The withdrawal of an LPP capital is taxed separately from income, at a progressive preferential rate, calculated according to the canton and the amount withdrawn. The higher the capital, the higher the tax rate. To optimize taxes, it is common to plan a staggered withdrawal, especially for insured persons with multiple vested benefits accounts.
Frequently asked questions
Withdrawal from the 2nd pillar is possible in 5 cases:
- retirement (ordinary or early),
- purchase or construction of a principal residence / repayment of a mortgage,
- definitive departure from Switzerland,
- setting up a self-employed business,
- or, in some cases, a disability pension.
You must submit a written request to your pension fund or the vested benefits institution holding your assets. The request must be accompanied by the required supporting documents (proof of property purchase, certificate of independence, certificate of departure, etc.).
If you suspect that your vested benefits have been lost, you must submit a request to asset search to the Centrale du 2ème pilier.
The lump-sum withdrawal is taxed separately from your income, at a reduced and progressive rate. The rate depends on the canton, the amount withdrawn, and your marital status. Staggering withdrawals over several years or accounts can help optimize taxation.
Yes, but the withdrawn capital cannot be reintegrated into the pension fund. If you return to Switzerland, you will start contributing again based on your new income, like any new insured person, while having the option to make buybacks.
No. Withdrawal is allowed only for your primary residence — the one you personally live in. Secondary residences, rental properties, or investment assets are excluded.
You can usually apply for early withdrawal from the age of 58, depending on your pension fund regulations. Please note: this will permanently reduce your benefits, as the conversion rate falls for each year of early withdrawal.
In this case, only the supplementary portion of your BVG/LPP credit can be withdrawn. The compulsory portion is transferred to a vested benefits account in Switzerland, until you retire.
Yes, most pension funds allow a mixed withdrawal: one part in capital, the other in annuity. This choice must be announced in writing within the set timeframe (often 1 to 3 years before retirement).
Lost BVG credits? Here's how to find them
Losing track of your occupational pension assets is quite common, especially after several job changes or moving abroad. These funds, from the 2nd pillar (LPP), nevertheless represent an essential part of your future retirement income.
Fortunately, Switzerland has set up a centralized service: the Centrale du 2ᵉ pilier, linked to the LPP Guarantee Fund, which allows anyone to recover forgotten LPP assets. Here’s how the search works, who to contact, and the steps to follow.
What is the LOB Guarantee Fund?
The LOB Guarantee Fund is a national institution that plays a central role in Swiss occupational benefit planning. It was set up to guarantee pension assets in the event of pension fund insolvency, and to manage the 2nd Pillar Central Office, the official body responsible for tracing forgotten BVG assets.
Based in Bern, the LPP Guarantee Fund operates under the supervision of the Occupational Pension Supervisory Commission (CHS PP).
Why undertake a BVG asset search?
Carrying out a search for vested benefits assets allows you to recover your forgotten pension capital after a job change or leaving Switzerland. These funds, often transferred to the Substitute Occupational Benefit Institution (LPP), remain locked at a very low interest rate.
Recover your BVG/LPP assets in 4 steps
You can search for BVG assets free of charge at the 2nd Pillar Central Office, managed by the BVG Guarantee Fund. This official service compares your personal data with those of pension funds and vested benefits institutions.
Steps to follow
- 1. Fill in the official form at www.sfbvg.ch
- 2. Please enter your personal details: surname, first name, date of birth, AHV number and previous addresses in Switzerland.
- 3. Enclose a copy of passport or identity card
-
4. Send application by post or e-mail to:
Centrale du 2ème pilier
Fonds de garantie LPP
Organe de direction
Case postale 1023
3000 Berne 14
- 5. You'll receive a reply by post, usually within a few weeks.
Research is free of charge and can be carried out at any time, even several years after you have started working in Switzerland.
What should I do with my recovered assets?
Transfer to a new pension fund
If you return to work or change employer, your assets must be transferred to your new employer's pension fund. This transfer is mandatory and allows you to continue making active contributions to your occupational pension plan and consolidate your pension entitlements.
Opening a vested benefits account
If you don't yet have a job, or are interrupting your career, your assets can remain in a vested benefits account or policy with a bank or insurance company.
Your savings thus remain secure and interest-bearing, at a higher rate compared to the Substitute Occupational Benefit Institution (LPP), where returns are minimal. The capital can be invested in investment funds for greater performance. You can transfer these assets to a new pension fund as soon as you are re-affiliated.
Opening a vested benefits account
In certain special casesyou can request a cash payment of your assets:
- Definitive departure from Switzerland
- Purchase of a principal residence
- Setting up your account
- Retirement
Be careful, however, as an early withdrawal reduces your future benefits and is subject to capital gains tax (reduced tax separate from the rest of your income). It is therefore advisable to assess the consequences carefully before making any request.
Possible optimizations
To reduce your tax bill, it's sometimes a good idea to:
- allocate assets to two accounts (in two different institutions),
- spread withdrawals over two fiscal years in a row,
- or change the place of residence (e.g. before retirement).
Invexa manages your BVG/LPP assets
At Invexa, we support you in the search, transfer, and optimization of your LPP assets. We analyze your personal situation and help you recover, consolidate, and grow your pension capital to enhance your retirement plan or long-term projects.
We work with renowned banks and insurance companies to ensure that every franc of your 2nd pillar is properly invested and remunerated. Thanks to our independent and transparent approach, Invexa can help you turn your forgotten assets into a real asset.
Frequently asked questions
To find your BVG/LPP assets, simply complete the official search form available on the Fonds de garantie LPP.
Your request will be processed by the Centrale du 2ᵉ pilier, which will compare your data with that of pension funds and vested benefits institutions. If an asset is found, you will be contacted by mail.
The exact amount of your 2nd pillar credit is shown on your BVG certificate sent by your pension fund.
If you have changed employer or lost contact with a previous institution, the 2nd Pillar Central Office will tell you where your account is and the estimated amount of your assets.
You can recover your 2nd pillar assets in several situations:
- Definitive departure from Switzerland,
- Access to ownership of your main home,
- Transition to self-employment,
- Retirement.
At the 2nd pillar central office, managed by the LOB Guarantee Fund .
Invexa can also take care of the search and repatriation of your BVG assets. Don't hesitate to Contact us.
What is early retirement?
In Switzerland, it is possible to retire before the ordinary retirement age (65 for men, 64 for women until the full entry into force of the AVS21 reform). However, leaving working life early also means giving up several years' income, with significant consequences for OASI pensions, BVG/LPP benefits and personal finances.
Successful early retirement cannot be improvised. It requires solid preparation in terms of occupational and private pension provision, a detailed analysis of future needs, and appropriate tax strategies.
Harmonization of retirement ages
The AVS 21 reform sets the reference retirement age at 65 for everyone. For women in the transitional generation (born between 1961 and 1969) who do not opt for early retirement, a lifetime pension supplement is planned.
What is early retirement in Switzerland?
Early retirement refers to the option of stopping professional activity before the legally established reference age for the OASI and occupational pension schemes. In Switzerland, the three pillars of the pension system each have their own conditions:
- OASI (1st pillar): early retirement is possible from the age of 63 (men) or 62 (women), with a reduction in pension ranging from 6.8 % to 13.6 % per year of early retirement.
- BVG (2nd pillar): Most pension fund regulations allow early withdrawal from the age of 58, with a reduced pension depending on age and the fund's technical parameters.
- Tied pension provision (pillar 3a): Linked individual pension assets can be withdrawn as early as 5 years before the normal AHV retirement age, currently 60.
Calculate my retirement benefits
- You can request an estimate of your AHV pension.
- Estimate the amount of your OASI pension online
Early retirement: is it a good idea?
The prospect of early retirement is a dream come true: more free time, a better quality of life, the chance to travel or engage in personal projects.
From a financial perspective, retiring earlier means living longer without income from employment. By advancing your retirement, you will receive a permanently reduced OASI pension, and your occupational pension benefits (2nd pillar) will also be lower. You will also need to compensate for several years without a salary while covering living costs, which may be higher than expected (health, leisure, unforeseen expenses).
Despite these challenges, early retirement can still be an excellent idea if it is well thought out and carefully planned. By anticipating the impacts, building sufficient reserves, and optimizing your pension and tax situation, it is entirely possible to fully enjoy this new stage of life.
How much will my early retirement benefit be?
1st pillar (AHV)
You can calculate your own OASI retirement pension based on your average annual income and the scale 44, reduced by the corresponding early retirement percentage:
- For a departure 1 year before legal retirement age, the pension is reduced by approximately 6.8 %.
- For a departure 2 years before, the reduction can be as much as 13.6 %.
The compensation fund allows the AHV pension to be anticipated between 1 month and 2 years at the most. This corresponds to an earliest departure of 62 years old for women born between 1961 and 1969, and 63 years old for the remaining policyholders.
- Anticipation period
- Reduction
- 6 months
- 1 year
- 1 year and 6 months
- 2 years
- - 3.4%
- - 6.8%
- - 10.2 %
- - 13.6 %
If you're not sure of your calculation, ask the AVS for a simulation. Conversely, a deferment of annuity is possible up to age 70. Once your AVS/AHV pension has been defined, you will have to reduce it in line with the anticipated early retirement date (maximum 2 years before the reference retirement age):
Harmonization of retirement ages
The AVS 21 reform sets the reference retirement age at 65 for everyone. For women in the transitional generation (born between 1961 and 1969) who do not opt for early retirement, a lifetime pension supplement is planned.
Example of early receipt of AHV pension
Let's imagine that Mr. Y decides to take early retirement 2 years before the reference age, and has an average annual income of CHF 85'000.
- He would normally receive a pension of CHF 2,460 / month or CHF 29,520 / year.
- As a result of the anticipation, he would only receive CHF 25,505 / year, or CHF 2,125.44 / month, for the rest of his life.
- 29,520 x (100% - 13.6%) = 25,505.28
OASI 2025 figures
- The maximum AHV pension is CHF 2,520 / month
- The minimum AHV pension is CHF 1,260 / months
- The maximum determining average annual income is CHF 90,720
Occupational benefits (2nd pillar)
In the 2nd pillar (LPP), early retirement is generally possible from age 58 if your pension fund’s regulations allow it. If you choose to receive a pension, its amount will depend on the accumulated capital, the applied conversion rate, and your retirement age. The younger the age, the lower the conversion rate. You can find your estimated pension amount on your pension statement.
You can also choose a full or partial lump-sum payment. The LPP allows a capital withdrawal of at least one-quarter of your assets (for the mandatory portion). In the case of a lump-sum withdrawal, the amount will be subject to capital benefits tax (at a reduced rate). The choice between a pension and a lump sum should be carefully assessed before making any decision, as it is irreversible.
If you have LPP assets in one or more vested benefits accounts or policies, they can be paid out no earlier than 5 years before and no later than 5 years after retirement. In most cases, the amount is paid as a lump sum, though this depends on the product. The full capital must be withdrawn. To avoid excessive taxation, it is recommended to open two separate accounts with different vested benefits foundations (this option can only be chosen when opening the account).
If you have doubts about the existence of LPP assets in vested benefits accounts or with the Substitute LPP Foundation, it is recommended to launch a free search with the Second Pillar Central Office to identify and repatriate your vested benefits assets.
Individual pension provision (3rd pillar)
If you’ve saved in a tied 3rd pillar (3a), you can withdraw your funds up to 5 years before the legal retirement age — that is, from age 60. However, be careful: just like a withdrawal from your pension fund, a 3rd pillar withdrawal is subject to capital tax at a preferential rate, but it also reduces your future reserves. In any case, comparing 3rd pillar options will help you choose the right product based on your goals. To avoid a high tax rate on lump-sum benefits, open several 3a accounts and stagger your withdrawals over several years.
A 3rd pillar B is also an option, noting that certain tax deductions apply to contributions in some cantons (Fribourg and Geneva), and that the capital withdrawal is tax-exempt (as long as the contract meets the pension criteria). A life annuity is also possible.
Linked pension plan figures
In 2025, it will be possible to pay out the following amounts in tied personal pension plans:
- Employees affiliated to a pension fund: Up to CHF 7,258 / year
- Self-employed or employees not affiliated to a pension fund: 20% of income, maximum CHF 36,288
How can I fill the gaps?
When it comes to early retirement, it's rare that benefits from the AHV and occupational pension schemes are sufficient to fully maintain your standard of living. The gap between financial needs and expected pensions can be significant, especially as life expectancy lengthens. Fortunately, there are a number of strategies for anticipating and bridging this gap, provided you start early enough.
1. Pension fund purchases
One option is to make buy-ins to your pension fund. By voluntarily increasing your LPP capital, you directly boost the future pension you will receive. Buy-ins are especially attractive because they are tax-deductible: every amount contributed reduces your taxable income and allows you to achieve significant tax savings.
Of course, the amounts eligible for buy-ins are capped and depend on the gaps you've accumulated during your professional career. Ideally, these buy-ins should be planned over several years to optimize their tax efficiency.
2. Contribute to a pillar 3a
The second is to fully exploit the potential of the pillar 3a. This private pension plan is particularly well-suited to early retirement. Each year, you can contribute a set amount: in 2025, the ceiling is CHF 7,258 for people affiliated to the 2nd pillar. The amounts paid in are directly deducted from your taxable income, making it a doubly effective way of saving.
The earlier you start saving in a 3rd pillar A, the greater the effect of capitalization is powerful. As you approach early retirement, these funds can be withdrawn as a lump sum, providing valuable financial leeway to offset the reduction in your pension.
3. Taking out a pillar 3b
The pillar 3b is more flexible than 3a: it is not limited in terms of amounts paid in, and funds remain available without age restrictions. However, it does not automatically offer tax advantages at federal level. In fact, taxation depends on how the product is structured and the canton of residence.
When a 3b contract is designed to qualify as pension provision, the capital paid out at maturity is exempt from income tax. This makes it a very attractive instrument for those planning early retirement, as it allows you to build a tax-free capital sum for retirement.
Pension criteria
The purpose of Pillar 3b retirement provision is achieved when:
- Payment is made after age 60
- The contract is taken out before age 66
- Contract duration is 5 years (10 if linked to funds)
If the 3b takes the form of a life annuity funded by a single premium, taxation is different. Only a fraction of the capital converted into an annuity is subject to tax at a reduced rate. In 2025, this fraction is 4% of the annual annuity amount, compared to 40% of the theoretical income under the old rules applicable until 2024. This change makes single-premium life annuities significantly more attractive tax-wise for future retirees.
Finally, it’s important to highlight that in certain Swiss cantons—particularly Geneva and Fribourg—contributions to a 3rd pillar B are tax-deductible up to a specified limit.
4. Investment in securities
For those wishing to build up an additional financial reserve for early retirement, investing in securities represents an attractive solution.
From a tax perspective, capital gains realized on securities held in a private account are exempt from income tax in Switzerland. This means that if you sell your stocks or funds at a profit, you won’t pay tax on that gain as long as you are considered a private investor and not a professional. However, your portfolio is subject to wealth tax, calculated on the net value of the securities held at the end of the year.
Thus, investing in securities fits harmoniously into an overall financial plan alongside traditional pension solutions. However, it’s important to start early, as investing in stocks is beneficial primarily over a long-term horizon.
5. Pillar 3a redemption (from 2026)
From 2026 (for fiscal year 2025), it will be possible to buy back to ten years of unpaid Pillar 3a contributions, amounting to CHF 7,258 per year in addition to the regular membership fee.
To be eligible for this purchase, you must have received income subject to AHV during the year in question, and have already paid the maximum contribution at the time of purchase. The amounts bought back are fully deductible from your taxable income.
Frequently asked questions
If you stop all gainful activity before the normal retirement age, you are still required to contribute to the AVS as a person without gainful employment. The minimum amount is about CHF 530 per year (in 2025), but it can be much higher depending on your assets and replacement income.
Contributions to AHV, IV and EO are calculated on the basis of assets and annual pension income multiplied by 20.
An annuity provides a stable income for life, regardless of your life expectancy or market trends. It is particularly suitable if :
- You're looking for absolute financial security,
- You have a low tolerance for risk,
- You have no experience in asset management,
- You have no other regular retirement income.
Its main drawback: the capital remains in the fund, and no amount is passed on to heirs.
The capital is paid out in a single lump sum, usually at a reduced tax rate (which varies from canton to canton). This choice gives you :
- Total management freedom,
- The opportunity to invest, pay off a mortgage, help your children or optimize your estate,
- A lever for tax optimization, notably by splitting withdrawals.
But be careful: you're responsible for the long-term future of your capital over 25 to 30 years, depending on your life expectancy. This requires rigorous management. In practice, it's very difficult to match the performance offered by the pension fund (conversion rate of 6.8%).
In most cases, a annuity + capital combination offers a good balance: securing a base income with an annuity, while retaining part of the capital for specific needs or projects.
No, once you leave your job, you also stop contributing to the 2nd pillar. Your capital is transferred to a vested benefits account or policy. It no longer generates new retirement benefits, but remains invested according to the conditions of the chosen institution. Some vested benefits foundations allow you to optimize this capital until you reach ordinary retirement age.
If you are 58 years or older and have been laid off, you can remain affiliated with your current pension fund. You will continue to benefit from death and disability coverage while continuing to make contributions.
Even with early retirement, health insurance remains mandatory in Switzerland. If you leave your employer, you lose LAA coverage (accident insurance) and will need to take out accident insurance on your own. Be sure to carefully compare coverage levels as well as supplementary insurances.
Yes, from the age of 58. If you permanently stop your gainful activity and do not take up salaried employment again, you can request the payment of your vested benefits before retirement age. This withdrawal is subject to a separate, reduced taxation rate, calculated according to your canton of residence.
Once the funds have been withdrawn, you take sole responsibility for managing your capital to cover your needs until you reach AHV retirement age.
The main risk is depleting your capital prematurely, especially if your expenses are underestimated or expected returns don’t materialize. Poor forecasting of fixed costs (health insurance, taxes, housing) or future needs (healthcare, unexpected family events) can undermine your financial independence. Careful planning, made several years in advance, is essential to minimize these risks.
Pillar 3a is the most tax-efficient solution:
Tax-deductible up to CHF 7,258 in 2025 (for employees affiliated to a pension fund),
Available to the self-employed (up to 20% of annual income),
Possibility of investing in funds (equities, bonds, ESG strategies),
Withdrawal permitted up to 5 years before AHV retirement age
Other solutions are possible, notably in 3b (unrestricted pension provision), where tax deductions are available in some cantons and withdrawals are tax-free. Subsequently, you can add to your assets through individual investments in securities, cash, real estate, etc.
To find out whether early retirement is possible, you will need to draw up a balance sheet to analyze projected annuities, assets and liabilities, and identify all sources of income. A budget should also be drawn up to define fixed and variable expenses, as well as the desired standard of living.
Have a pension plan It's a modest investment to avoid costly mistakes.
Redemptions must be carefully planned. Each repurchase is deductible of taxable income, resulting in substantial tax savings, especially for higher incomes.
Buybacks fill the gap contribution gaps (e.g. career breaks, part-time work) and often allow :
A better retirement pension,
Greater flexibility over the amount of capital that can be withdrawn.
Be careful, however, as you won't be able to make a tax-free capital withdrawal after a buyback. for 3 years.
As soon as possible. At the age of 25, even if retirement seems a long way off, the first few years of working life are a real challenge. crucial to lay the foundations for your pension provision, and early years are ideal for benefiting from the cumulative effect of compound interest (notably via pension funds).
From 40 years oldwe're starting to get better visibility on your professional, family and asset situation. This is the ideal time to carry out an initial, comprehensive pension assessment, identify gaps, plan pension fund purchases, project a retirement age and structure your investments.
From 50 yearsplanning becomes more concrete. You can consider a precise estimate of AHV and BVG pensions, a tax analysis for capital withdrawals (BVG, 3a), asset decumulation strategies, as well as simulating an early or postponed retirement.
Starting early allows you to smooth out your efforts, reduce the financial pressure as you approach retirement, and keep all your options open (early retirement, gradual reduction, flexible retirement, optimized transmission).
AHV/IV/EO contribution rate in 2025
In Switzerland, everyone in gainful employment contributes to social security through compulsory contributions. These contributions finance the old-age (AVS), disability (AI) and loss-of-earnings (APG) insurance schemes, and are deducted as a percentage of wages.
- Contribution
- Employee %
- Employer
- Total / independent
- AVS
4.35
4.35
8.70 / independent: 8.10
- AI
0.70
0.70
1.40
- APG
- Total AHV/IV/EO contributions
5.3
5.3
10.6
All in all, contributions toAVS, AI, and APG in Switzerland are respectively: 8.7%, 1.40%, and 0.50%. All in all, 10.6% of the salary is deducted. Half of the contribution is paid by the employer, the other half by the employee.
Maximum AHV (OASI) pension
The maximum AHV pension in 2025 is:
- CHF 2,520 / month, or CHF 30,240 / year
In 2025, the maximum AHV (Old Age and Survivors' Insurance) pension in Switzerland will be set at CHF 2,520 per month for a single person with a full contribution period and an average annual income of at least CHF 90,720.
Maximum AHV pension for couple
The maximum AHV pension for a couple in 2025 is:
- CHF 3,780 / month, or CHF 45,360 / year
For married couples, the combined total of both pensions is capped at 150% of the maximum single-person pension, which amounts to CHF 3,780 per month.
Minimum AHV pension
The minimum AHV pension in 2025 is:
- CHF 1,260 / month, or CHF 15,120 / year
In 2025, the minimum AHV/OASI (Old Age and Survivors' Insurance) pension in Switzerland will be set at CHF 1,260 per month for a single person with a full contribution period.
This amount applies to people who have made uninterrupted contributions for the full required contribution period and have a average annual income less than or equal to CHF 15,120.
AHV contributions
- Total AHV/IV/EO rate for employees: 10.60 % of gross salary
- Total AHV/IV/EO self-employed rate: Between 5.371% and 10% of earned income
In 2025, AVS contributions in Switzerland are set at 10.6% of gross salary for employees, split equally between employer and employee, at 5.30% each.
For self-employed individuals, the contribution rate is progressive based on income: it ranges from 5.371% to 10%, with the maximum rate of 10% applying to annual income starting from CHF 60,500.
The people not in gainful employment must pay an annual membership fee of between CHF 530 and CHF 26,500This is based on wealth and pension income. Finally, salaries below CHF 2,500 per year are only subject to contributions at the employee's request.
How are AHV pensions calculated?
1. Contribution period
2. Average annual income
3. Bonuses
Why should cross-border commuters think about additional savings?
Income from 1st and 2nd pillars are not enough to maintain a standard of living after retirement, especially for those who have not worked exclusively in Switzerland. The 3rd pillar represents an essential compensation tool. In addition, it offers the possibility of investing in a variety of vehicles, some of which guarantee capital security.
Types of 3rd pillar in Switzerland
In Switzerland, there are two types of third-pillar pensions: the tied personal pension (3rd pillar A)and the unrestricted individual pension plan (3rd pillar B).
Pillar 3A (restricted pension plan)
The Pillar 3a is designed specifically for retirement. The funds paid into it can only be recovered at the time of retirement or under certain conditions. exceptional situations (purchase of principal residence, permanent departure from Switzerland, etc.).
Payments are deductible of taxable income, subject to compliance with certain conditions, in particular for cross-border commuters (for example, the choice of cross-border commuter status). quasi-resident in some cases).
Contribution limits
In 2025, it will be possible to pay out the following amounts in tied personal pension plans:
- Employees affiliated to a pension fund: Up to CHF 7,258 / year
- Self-employed or employees not affiliated to a pension fund: 20% of income, maximum CHF 36,288
The 3rd Pillar A is divided into two categories: in banking and insurance. In insurance, we find classic life insurance (pure risk) or mixed (part of savings in funds or interest-bearing account), but also disability insurance, essential for the self-employed. Increasingly, insurance companies are also offering life insurance contracts. more flexible tied pension planssimilar to the 3a banks, but which offer covers (e.g. waiver of premiums in the event of disability, profit sharing, guarantees, etc.).
3a banking offers a more simple and flexibleThis type of account allows you to pay in the amount you want each year. Essentially, there are two possible forms: the interest-bearing account, linked to a investment funds. No additional coverage is available.
Pillar 3B (unrestricted pension plan)
Unlike the 3A, the 3B is not designed exclusively for retirement. It offers great freedom in the use of funds, which can be mobilized for a variety of projects or financial needs. When we talk about 3B, we mean all the instruments that are not included in the 1st, 2nd and 3rd pillar A. These may include life insurance, classic cars, savings accounts, stocks or bonds, real estate, or even a life insurance contract. life annuity.
Contributions are not capped, allowing everyone to adjust their savings according to their financial situation and personal objectives. 3B offers a number of tax benefitssuch as thetax exemption on lump-sum benefits on withdrawal (if the pension provision is fulfilled), as well as income tax of only 4% for single-premium life annuities.
Conditions for taking out a 3rd pillar
For cross-border commuters, access to the 3rd pillar, particularly the linked version (3A), is subject to a number of conditions:
- Income subject to AHV: The 3A is intended for people who pay AVS contributions. For cross-border commuters, this means that their working income in Switzerland must be subject to these contributions.
- Tax status and quasi-resident: To benefit from the tax advantages of 3A, a cross-border commuter must opt for quasi-resident status. In practical terms, this means that 90 % of the tax household's income must be taxed in Switzerland. If a significant proportion of income (over 10 %) is taxed in the country of residence (as in France, for example), the quasi-resident option is no longer available.
To sum up, before taking out a 3rd pillar A, it is essential to check that your income from work in Switzerland is subject to contributions. AVSthat it meets the criteria for the quasi-residentin order to benefit from tax benefits. Moreover, quasi-resident status exists only in the cantons of Geneva and Fribourg.
On the other hand, a 3rd pillar B is open to all and offers a complementary savings solution without the constraints of tax status or payment ceilings, giving you the freedom to manage your portfolio for the future.
As of January 2021, cross-border commuters can no longer request a rectification of withholding tax via a subsequent ordinary taxation (TOU), which cancels the tax deduction on their remittances. However, by obtaining the status of quasi-resident - conditional on 90 % of household income being taxed in Switzerland - it is possible to reduce taxable income by up to approx. CHF 7,258 per year per person.
How can I take out a 3rd pillar as a cross-border commuter?
To open a 3rd pillar A as a cross-border commuter, you must be able to provide your G permit. medical questionnaire will be requested at the time of underwriting. Some insurance companies do not ask for a medical questionnaire if the insured is sufficiently fit. young. It is therefore advisable to open a 3rd pillar A account at an early stage.
What 3rd pillar options are available for cross-border commuters?
In Switzerland, very few insurance companies accept cross-border commuters in the 3a category. Pillar 3a bank plans are, however, accessible to cross-border commuters in most cases.
Designing a savings strategy with the 3rd pillar
1. Define your goals
To begin with, it's essential to clearly define your savings objectives. This means identifying whether you simply want to build up savings for the future. retirement or if you also need to cover risks such as theearning incapacitythe deathor other financial contingencies. Once you've established your goals, you'll know whether you need a full coveragea simple funds savings plan or other solution to meet specific short- or medium-term needs.
2. Define your investor profile
Next, it is important to assess your investor profile in order toadapt your strategy to financial market fluctuations. To do this, you need to determine your risk tolerance and your investment horizon. An investor curator profile will prefer low-risk, moderate-return funds or a simple savings account, while a more dynamics could opt for more aggressive investments.
This personal analysis is essential for choosing products that match your needs. preferences and your situation current financial situation.
3. Compare funds and performance
Once your objectives and investor profile have been clearly defined, it's time to compare different offers available. This involvesanalysis performance historical and fees associated with 3rd pillar funds. You can compare the returns of guaranteed funds, unsecured funds and investment funds. actions or even solutions mixedkeeping in mind that the diversification remains an important lever for optimizing returns and limiting risks. A detailed comparative analysis will enable you to select products suited to your savings strategy.
4. Combining contracts
Finally, to maximize the tax benefits of the 3rd pillar, it may be wise to combine several contracts. Subscribing to several products allows you to make staggered withdrawals and therefore reduce your marginal tax ratetaxation.
Frequently asked questions
Yes, cross-border commuters can take out a 3rd Pillar A, even if they live in France. This savings product is open to anyone working in Switzerland.
However, the Swiss tax advantage (deduction of payments from taxable income) is only available to cross-border commuters who have opted for quasi-resident status via T.O.U. (Taxation ordinaire ultérieure), i.e. in Geneva and Fribourg only.
The 3rd pillar supplements the 1st and 2nd pillars (AVS/AI and LPP) to maintain your standard of living in retirement.
- The pillar 3a (linked) is a locked-in savings up to 5 years before retirement, with tax benefits under certain conditions.
- The pillar 3b (free) offers greater flexibility and can be used as savings, life insurance or investment, with no payment limit.
From 2021The classic deductions linked to the 3rd pillar (and other expenses) are only possible for cross-border commuters with quasi-resident status (T.O.U), i.e. when 90 % of household income is taxed in Switzerland.
If you complete this conditionPillar 3a contributions can be deducted from your Swiss taxable income, up to a maximum of CHF 7,258 per year in 2025. Otherwise, you won't benefit from any tax deduction, but you can still save freely in a 3b to prepare for your retirement.
3rd Pillar A funds can be withdrawn in the following ways following cases:
- Definitive departure from Switzerland,
- Transition to self-employment,
- Purchase or repayment of a main property,
- Purchase of 2nd pillar contributions,
- Retirement (up to 5 years before legal retirement age).
Withdrawal is subject tocapital gains taxat a reduced rate. 3rd Pillar B funds, on the other hand, are free to withdraw, subject to the conditions set out in the contract.
Topics covered
- The detailed operation of the Swiss pension system and its three pillars.
- Updated amounts, conditions and benefits for 2025 (OASI, BVG, 3rd pillar).
- Rules for contributions, redemptions and early withdrawals.
- Tax benefits and optimization strategies.
Understanding the Swiss pension system
The Swiss pension system is recognized worldwide for its stability and reliability, yet it often remains difficult to understand. Between the OASI, the LPP, and the third pillar, it’s not always easy to know who pays what, how much you’ll receive, or how to properly prepare for retirement.
To answer these questions, Invexa has created "The Swiss Pension Guide": a comprehensive guide, updated for 2025, to help you understand, plan and optimize your financial future.
Three pillars, one goal
The booklet explains step by step how the Swiss retirement system works, based on the three complementary pillars:
- 1st pillar - OASI/DI/EL: The compulsory state pension scheme, based on solidarity between generations. It guarantees a minimum standard of living in the event of old age, disability or death.
- 2nd pillar - LPP/BVG: Occupational pension plans, financed by employers and employees. Its aim is to maintain the same standard of living as before retirement.
- 3rd pillar - Individual pension plans (3a and 3b): Voluntary savings to optimize your retirement, benefit from tax advantages and strengthen your financial security.