Your child shouldn’t have to miss out on anything. No doubt you want to give the best possible education for your offspring, give them that highly coveted bike or the longed for ballet lessons.
Only what would your child or children do without you? No one likes to think about that. It’s reassuring to have an answer though.
In the worst case your child would receive an orphan’s pension
If your child loses a parent, they have the right to an orphan’s pension from the first or second pillar. Two orphan’s pension exists should both the mother and the father die. Your child would receive this until they reach the legal age or finish their education – latest however until their 25th birthday. A prerequisite for the claim is:
- The deceased person should have paid at least a full year’s contribution into AHV
- The deceased person or persons should be affiliated with a pension fund
An AHV orphan’s pension is between 470 and 940 francs per month. For two orphans the pension is at most 1,410 francs per month (Effective: 2016). The size of the pension depends in each case on the income and number of years’ contributions of the deceased parent. But education credits are also relevant for the orphan’s pension. The AHV will allow for those times when you have taken care of your children. The orphan’s pension can differ by pension fund according to the rules of the individual fund.
Supplementary benefits can help with unexpected shortfalls
Sometimes the provision is greater if the income of the surviving parent and the orphan’s pension is not sufficient to cover basic costs. In this case your child has a possible claim to supplementary benefits from AHV and IV. These payments support your family so that they can gain control of the most important outgoings.
Private pension additionally protects your child
In serious times having the financial situation sorted makes everything easier. Could money be tight if your income suddenly disappears? Therefore, it is important to have your child additionally protected. A risk insurance is one possibility. It pays out a lump sum if the insured person dies.
Do you have so much wealth that you don’t need insurance? Then you should appoint an administrator for your funds. Then your child will, even when there is no Will & Testament, receive at the least a compulsory portion of your estate. You should however establish who will have control over the assets, until your son or daughter reaches adulthood.
If something happens to either the mother or the father the upbringing and management is best taken over by the surviving parent. If both die it will be twice as complicated. Keep your wishes about care provisions safe and in writing. Thereby you help your offspring if they find themselves in a difficult situation.