It’s better to begin at 30 rather than 40 years old and 40 is preferable to 50! A simple calculation shows why your older self will thank you. For example, at age 25 you begin paying 100 francs every month into a retirement account. With an interest rate of 2.8% you would have an additional net sum of around 87,000 francs by the age of 65. Saving the same amount from 35 onwards, with 55,000 francs on retirement you will have considerably less.
Make your future brighter
No doubt you would like to enjoy your time with the family during retirement. Perhaps you would also still like to travel the world or make a longstanding dream come true.
So that you can realise your dreams, it’s best to be thinking ahead already. The 1st and 2nd Pillars together only cover roughly 60% of your normal income. With the help of the 3rd Pillar this gap be filled and you can expect 80-100% of your earlier income.
How does the 3rd Pillar principle actually work?
The Swiss retirement system is based upon 3 pillars. In the graphic below you will find this explained in detail: