Living in Switzerland

Have you got the right pillar three?

3rd November 2017

The Author: Oliver Maher
Oliver is the Business Development Director at United Advisers. He looks after new clients to help them assess and review their immediate and long-term needs.

Many people come to realise that the pensions they will receive from Pillar 1 and 2 pensions (State and occupational pensions respectively) may be insufficient to maintain or finance the lifestyle they want in retirement. As a result, the subject of the importance of investing in Pillar 3 pensions is becoming a hot topic in many Swiss circles.

No-one knows for certain what might happen in the future, so it makes a lot of sense to identify private pensions that resonate with your financial goals and individual circumstances. To that end, we take a closer look at the diverse options out there.

How do you choose the right Pillar 3 option for you?

Researching the many pillar 3 options available can be a time-consuming and confusing undertaking. Broadly, however, these fall into two categories; solutions offered by banks, and those offered by insurance companies.

When it comes to deciding what the best Pillar 3 solution is for you, your personal circumstances and what you want to achieve in the future are the most important things to consider.

Before choosing the right option for you, it is important you seek advice from an adviser who fully focusses on you, your family, and your goals; who can fully understand your current circumstances, your future desired lifestyle and can help you design and navigate a path between the two.

Why choose a Pillar 3 banking solution?

If you have no-one you need to protect financially, like a partner or children, a banking solution may be right for you.

Contributions are completely voluntary and not tied to defined times and amounts, so a banking solution may suit you if you don’t want the structure a savings plan brings.

As there are no contract terms, no payment obligations, and it’s possible to change banks when you want, the key incentive for adopting an unstructured banking solution is flexibility.

Why choose a pillar 3 insurance solution?

If your focus is protecting your financial future, and that of your family and dependents, then an insurance solution is for you.

Insurance solutions offer guaranteed capital when they mature, occupational disability protection, protection for your loved ones if you should die and, by law, payment protection. In short, the byword for insurance solutions is ‘security’.

There are a vast variety of insurance products that can be adapted to suit any lifestyle, and designed to focus on your future. Because these products combine protection with capital growth, they are the most popular, and widely used, solutions.

In Conclusion

Whether you want the flexibility offered by a banking solution or the security offered by an insurance solution, your decision should always be based on your circumstances both now and in the future, as well as your goals and the lifestyle you expect to follow in retirement.

Properly analysing where you are now, determining where you want to be in the future, and planning how to get there is no mean feat and not one we recommend executing on your own but sharing with your financial adviser.

If you’d like to discuss taking action to put pillar 3 options in place that are right for you, please get in contact for your free pillar 3 review.

Click for your free pillar 3 review