Retirement provision and family – retirement provision for every scenario.
Life often turns out different from how we’d hoped. So it’s important not only to secure your own financial future, but also that of your family. What can you and your family expect in the case of divorce, an accident, illness, or death?
When you start a family, your needs change from one day to the next. Your focus is on securing the financial security of your loved ones.
Pillar 1 (AHV/IV), your pension fund and accident insurance go some way to providing financial protection against the risks of disability and death.
Death and disability
Instances of death and disability per 1,000 employed people
Source: Zurich, Switzerland, Actuarial Office (Life), 2012
Comprehensive protection on disability and death
Your state and occupational pensions, as well as accident insurance, provide benefits in the event of disability or death. Often, however, these benefits are unable to completely meet your financial requirements.
Income structure in the event of disability or death
The restricted pension 3a and unrestricted pension 3b let you insure the risks of disability and death and take advantage of additional benefits. This voluntary retirement provision can be used to reduce or cover any income shortfall.
We would be happy to assist you to provide optimal protection for your family by preparing a detailed calculation of an appropriate level of additional insurance cover.
Common-law partners do not have the same legal status as married partners. In principle, the surviving partner has no entitlement to a pension. You can arrange retirement provision for your partner on a private level, as long as it is in line with inheritance law. It is recommended that you record any agreements in a will or inheritance agreement.
The AHV does not pay a pension to common-law partners
Those who are not married do not receive an AHV survivors' pension after their partner's death. Private term life insurance provides the answer.
Your pension fund will also support your partner in most cases
Pension funds are not legally required to pay pensions to common-law partners. Many pension schemes will, however, pay a pension voluntarily, subject to certain conditions. Find out more in the pension fund regulations and inform the pension fund who your beneficiaries are.
Restricted pillar 3a retirement provision offers further options
If your occupational pension fund does not provide benefits for common-law partners, then your private pension scheme is all that remains.
Pillar 3a withdrawals are regulated by law. In some circumstances, you have the option to name common-law partners as beneficiaries under pillar 3a.
Your unrestricted pillar 3b plan leaves you free to decide
In the event of your death, your common-law partner will be able to take advantage of the benefits in accordance with the testamentary and beneficiary arrangements. However, you are not allowed to breach the legal rights of your heirs to their compulsory share of your estate.
The division of retirement savings on divorce is legally regulated. The legislation is based on the premise that both spouses have made an equal contribution to the marriage. In principle, the retirement savings are divided equally.
The AHV ensures equal benefits
Once the divorce is finalized, the AHV income calculated during the marriage is split equally between both spouses. It is recommended that you ask your social security administration office to split your income immediately after the divorce.
Pension fund assets are halved
If only one spouse pays into a pillar 2 scheme, the funds saved during the marriage are split equally. If both spouses are members of a pension fund, both are entitled to half the funds built up by the other spouse during the marriage. If the spouses do not have identical pension fund benefits, one will therefore suffer a loss of capital. The affected spouse has the option to compensate for the lost insurance cover by making a tax-privileged purchase into a pension fund.
Pillar 3 is also usually halved
Pillar 3a contributions are also generally paid out of employment income. In most cases, the assets saved during the marriage are split equally.
Contact us to help you get your retirement savings back in line following a divorce. We would be happy to assist you.
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