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Old 22.03.2013, 08:22
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Vested Benefits Policy, anyone?

When you terminate your employment you have three options for your pension savings:
- Transfer it to the new employer's fund
- A vested benefits account with a bank, until such time as you take up a new employment
- A Vested benefits policy

I was if any has looked into this third option and could perhaps supply some links?
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Old 22.03.2013, 18:42
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Re: Vested Benefits Policy, anyone?

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When you terminate your employment you have three options for your pension savings:
- Transfer it to the new employer's fund
- A vested benefits account with a bank, until such time as you take up a new employment
- A Vested benefits policy

I was if any has looked into this third option and could perhaps supply some links?
As soon as you are reemployed you must transfer the entire vested benefits into the new employer's pension plan. Till then, it is usually best to park it in a bank account.

Putting vested benefits into an insurance policy only makes sense when
1. You have an insurance need, e.g. young children.
2. And you anticipate not being employed for many years, e.g. young mother planning to stop working and raise a family.

Insurance policies usually have substantial upfront and redemption costs. Hence unsuitable for short-term parking.
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Old 22.03.2013, 19:38
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Re: Vested Benefits Policy, anyone?

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As soon as you are reemployed you must transfer the entire vested benefits into the new employer's pension plan. Till then, it is usually best to park it in a bank account.

.
Not totally true, only if your employed in a permanent position. I have a vested benefits pension & a freelancers pension which all my employers have paid into except some work for the Government who claimed they are not legally obliged too. (like all the others...)
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Old 22.03.2013, 20:21
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Re: Vested Benefits Policy, anyone?

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As soon as you are reemployed you must transfer the entire vested benefits into the new employer's pension plan. Till then, it is usually best to park it in a bank account.
This is not correct. You are only obliged to but funds into an employer's pension fund if it is not in a policy.

In the current environment it might well be a worth while as a way of crystallising your benefits to date. Moving your savings into a poorly performing fund that in addition is under funded could result in your savings going down either due to poor performance or a restructuring to tackle underfunding.

I'm trying to find some examples of these products, just to do some analysis of them....
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Old 23.03.2013, 23:23
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Re: Vested Benefits Policy, anyone?

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This is not correct. You are only obliged to but funds into an employer's pension fund if it is not in a policy.

In the current environment it might well be a worth while as a way of crystallising your benefits to date. Moving your savings into a poorly performing fund that in addition is under funded could result in your savings going down either due to poor performance or a restructuring to tackle underfunding.

I'm trying to find some examples of these products, just to do some analysis of them....
Credit Suisse state:
"Vested Benefits Policy
In contrast to a vested benefits account, a vested benefits policy automatically insures a lump-sum death benefit. If you wish you can also include a disability pension. The fact that insurance coverage is included usually means that the interest rate is lower than for a vested benefits account. If you join a new pension fund, the vested benefits policy will have to be transferred to the new pension fund.


https://pensionskasse.credit-suisse....unt-or-policy/
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Old 24.03.2013, 00:07
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Re: Vested Benefits Policy, anyone?

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Credit Suisse state:
"Vested Benefits Policy
In contrast to a vested benefits account, a vested benefits policy automatically insures a lump-sum death benefit. If you wish you can also include a disability pension. The fact that insurance coverage is included usually means that the interest rate is lower than for a vested benefits account. If you join a new pension fund, the vested benefits policy will have to be transferred to the new pension fund.


https://pensionskasse.credit-suisse....unt-or-policy/
Thanks, I've seen that but it is not the thing I'm after. I guess I'll have to start calling around next week.... thanks.
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Old 15.01.2017, 11:35
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Re: Vested Benefits Policy, anyone?

Did you get an answer @ Jim2007

I have my pension in a vested account with UBS. Could I put this in a vested account fund that might give me a better return in long term and not be obliged to move this to the pension fund of my new employer when I start work again. At the moment I am on a career break
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Old 15.01.2017, 12:01
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Re: Vested Benefits Policy, anyone?

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Did you get an answer @ Jim2007

I have my pension in a vested account with UBS. Could I put this in a vested account fund that might give me a better return in long term and not be obliged to move this to the pension fund of my new employer when I start work again. At the moment I am on a career break
AFAIK you have to transfer this to the new employer´s pension fund when you start working. At least that was on the document I had to sign when I joined my new employer´s pension fund
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Old 15.01.2017, 12:19
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Re: Vested Benefits Policy, anyone?

A Ktipp article says that the new employee is supposed to transfer the entire pension capital to the new employer's pension fund. However, the article says that there are no legal consequences if this is not done.

If the decision is taken to keep part of the pension capital outside of the new employer's pension fund, two approaches are possible:

1. Open two (or more) Freizügigkeitskonti and then transfer the pension capital from only one to the new employer.
2. Transfer only part of the pension capital from the Freizügigkeitskonto up to the amount required by the new pension fund to receive a full benefit.

For more information, please see this article:

https://www.ktipp.ch/artikel/d/das-k...erdeckung-ist/
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Old 15.01.2017, 12:32
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Re: Vested Benefits Policy, anyone?

Thanks for interesting thread. This will be my case from tomorrow onwards. I currently keep my 2nd pillar in vested benefits account with a bank. Upon signing my contract and filling in an employee sheet, there was no mention of it. I presume the HR will discuss it with me tomorrow.

What's normally the procedure applicable anyway under circumstances? As one cannot really withdraw from or deposit to such account, I suspect that the employer contacts the bank and requests to transfer sum to their pension fund, oder? Or as a holder of such account, I simply instruct the bank to transfer the sum to the indicated by employer the pension fund.
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Old 15.01.2017, 12:33
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Re: Vested Benefits Policy, anyone?

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What's normally the procedure applicable? As one cannot really withdraw from or deposit to such account, I suspect that the employer contacts the bank and requests to transfer sum to their pension fund, oder? Or as a holder of such account, I simply instruct the bank to transfer the sum to the indicated by employer's pension fund.
I had to send a letter to my previous pension fund and asked them to transfer it to the new one, got a standard letter from HR to do that.
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Old 15.01.2017, 12:37
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Re: Vested Benefits Policy, anyone?

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I had to send a letter to my previous pension fund and asked them to transfer it to the new one, got a standard letter from HR to do that.
Great. My previous employer upon exit parked my pension in default (chosen by them) account with 0.00% interest p.a. and I quickly reacted to it by opening the vested benefits account with a bank that at least guarantees meager 0.25% for few hotdogs and beers.
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Old 15.01.2017, 12:58
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Re: Vested Benefits Policy, anyone?

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A Ktipp article says that the new employee is supposed to transfer the entire pension capital to the new employer's pension fund. However, the article says that there are no legal consequences if this is not done.
True, but the way it is done is that you receive a form from your employer's pension fund which you must forward to the institute holding your account requesting the transfer. They in turn do the necessary calculations on outstanding interest, complete the form and transfer all of the fund to the new pension fund.

However my research at the time found that for those in the know each pension foundation has a means of letting them know how much you want them to transfer

My advice is to start with finding out that maximum amount needed to buy full benefits in the new fund. If you will have a surplus then find out what the rate of return on the surplus will be. If you are not happy with it, then talk to your bank advisor about what you want to do. No doubt he'll teach you the secret handshake
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Old 15.01.2017, 13:05
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Re: Vested Benefits Policy, anyone?

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Great. My previous employer upon exit parked my pension in default (chosen by them) account with 0.00% interest p.a. and I quickly reacted to it by opening the vested benefits account with a bank that at least guarantees meager 0.25% for few hotdogs and beers.
The default only comes into play if you fail to provide their pension fund with instructions on where the money is to go. The default is determined by the industry in which the company operates, not their choice. Furthermore the default must pay the minimum as set out by law.
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Old 15.01.2017, 13:09
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Re: Vested Benefits Policy, anyone?

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Thanks for interesting thread. This will be my case from tomorrow onwards. I currently keep my 2nd pillar in vested benefits account with a bank. Upon signing my contract and filling in an employee sheet, there was no mention of it. I presume the HR will discuss it with me tomorrow.

What's normally the procedure applicable anyway under circumstances? As one cannot really withdraw from or deposit to such account, I suspect that the employer contacts the bank and requests to transfer sum to their pension fund, oder? Or as a holder of such account, I simply instruct the bank to transfer the sum to the indicated by employer the pension fund.
You will receive a form from the new pension fund to complete and send to the foundation holding your vested account.
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Old 15.01.2017, 13:12
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Re: Vested Benefits Policy, anyone?

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I had to send a letter to my previous pension fund and asked them to transfer it to the new one, got a standard letter from HR to do that.
This is not the same thing. A pension fund to pension fund will always be the full amount.
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Old 15.01.2017, 13:15
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Re: Vested Benefits Policy, anyone?

One other point. Any amount remaining in the vested account can be accessed on your 60th birthdate or there after.
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