Saving with securities under Pillar 3a Long-term, responsible pension planning

You can improve your retirement planning thanks to continuous securities savings.

by UBS Insights 12 Apr 2017

When it comes to investing, women are still significantly more cautious than men. However, it has been proven that they have greater investment success than the reputed “stronger” sex. Why? They act more prudently and have more patience. That’s why you shouldn’t hesitate to invest in securities when it comes to your pension.

It’s best to start young

Return-conscious women start saving at a young age in securities in tax-deductible pillar 3a and, if possible, contribute the maximum allowed amount (2021: CHF 6,883). Those with a long investment horizon would be well advised to invest in funds with varying equity components as equity returns are considerably higher than fixed-income investments over the long run. Saving by monthly standing order has certainly proved its worth: it minimizes the risk of catching a bad time to invest.

Reducing the equity component with increasing age

For security reasons, women aged 45 and older should gradually decrease their equity exposure and instead contribute their ongoing 3a payments into a fund with a low equity component. Depending on the investment profile, a traditional retirement savings account makes sense in the last years prior to withdrawing 3a funds. This provision strategy can enable you to generate considerably higher returns without increased risk of loss.

More courage to accept risk can allow women to generate attractive returns. This holds true in particular when it comes to saving for retirement, which is inherently long term.