Expert knowledge on the 3rd pillar

Because all annual deposits up to a maximum of CHF 7,056 (as at 2023) can be declared in your tax return. Michael Zehnder, Financial Planning Consultant at Zuger Kantonalbank, gives pension tips in an interview with Communications Consultant Ina Gammerdinger.

Michael, when should people start saving?

Ideally, right now. The earlier you save, the longer the investment horizon, and the money can work for you. Even small investments pay off.

How would you define “small”?

Even with just CHF 50 per month, I can invest in securities. These first-class investment funds are professionally managed by our specialists – I don't have to do anything.

How do I do that?

Simply come to a personal consultation at one of our 14 branches or sign up for the product online.

I can save by...

... making deposits by single payment order or standing order. I recommend a standing order so that you don't forget.

Can I make withdrawals at any time?

Withdrawals are limited with the multi-talented Savings 3a account because it's a tax-privileged product and subject to a range of conditions. This means that the pillar 3a assets are tied, and unlike a standard savings account, you can't access them freely.

When do I get the money back?

There are various options, for example if you become self-employed, if you emigrate from Switzerland permanently or if you buy your own home. Or as retirement assets: you can withdraw the money a maximum of five years before normal retirement age. We recommend staggered withdrawal to avoid any tax disadvantages. Savers should therefore open a second or a third Savings 3a account once their deposits reach CHF 45,000.

Why should I invest in securities?

Young people have a long investment horizon, so they have time to let the money work for them. If the savings are left in a pillar 3a account, they lose purchasing power over time because interest rates are too low to offset inflation. This means that the assets saved will be worth less later than they are now. But with securities savings, you benefit from trends on the financial markets.

What investment solutions are there?

There are a wide range, with something for everyone: equities, real estate and bonds. Many investments also comply with ESG criteria.

What does that mean?

ESG refers to evaluation criteria for sustainable investment products. It stands for Environmental, Social and Governance. “Environmental” covers themes such as climate change and energy efficiency, the promotion of renewable energies and biodiversity, and the reduction of environmental pollution. “Social” relates to working conditions such as the prohibition of child and forced labour, workplace safety and health, and the promotion of education and gender equality. “Governance” covers measures for responsible corporate governance.

How do I find the right fund for me?

We're happy to help our customers with this. We take their entire personal situation and planning as well as their needs and wishes into account in the consultation. Together, we draw up an investor profile, which leads to the right investment strategy.

What do you mean by “investment strategy”?

It reflects the individual's personal risk capacity and risk appetite, taking into account the investment horizon. A strategy is conceived for the long term and shouldn't be changed constantly. We take the same approach with pillar 3a and suggest a suitable investment product.