Go Back   English Forum Switzerland > Help & tips > Finance/banking/taxation  
Reply
 
Thread Tools Display Modes
  #21  
Old 14.05.2019, 11:38
eyebeebe's Avatar
Forum Veteran
 
Join Date: May 2009
Location: Pfäffikon SZ
Posts: 1,577
Groaned at 16 Times in 15 Posts
Thanked 1,666 Times in 785 Posts
eyebeebe has a reputation beyond reputeeyebeebe has a reputation beyond reputeeyebeebe has a reputation beyond reputeeyebeebe has a reputation beyond reputeeyebeebe has a reputation beyond repute
Re: Pension calculation

Quote:
View Post
I doubt the employer will pay anything like 10% for 25 years.
Agreed. I’d be gutted if my employer reduced their contributions by so much
Reply With Quote
This user would like to thank eyebeebe for this useful post:
  #22  
Old 14.05.2019, 11:43
Senior Member
 
Join Date: Nov 2013
Location: zurich
Posts: 256
Groaned at 4 Times in 4 Posts
Thanked 166 Times in 89 Posts
peaky has earned some respectpeaky has earned some respect
Re: Pension calculation

Quote:
View Post
I doubt the employer will pay anything like 10% for 25 years.
Up to a max of 85k the employer must pay a minimum % into the pension, they must match your personal contribution. After 85k gross earnings this is a bit grey and is a kind of bonus if you get pension payment on that.

6k a month is less than the 85k max limit

35-44 years old is 7% therefore 3.5% each
45-54 is 15% so 7.5% each
55-65 is 18% so 9% each

Which yes ok is a 7.5% average. But its unlikely unless you are contracting/consulting you would only get 3.5% from the employer
Reply With Quote
  #23  
Old 14.05.2019, 11:56
aSwissInTheUS's Avatar
Forum Legend
 
Join Date: Nov 2007
Location: Zurich area
Posts: 10,122
Groaned at 78 Times in 69 Posts
Thanked 15,279 Times in 6,795 Posts
aSwissInTheUS has a reputation beyond reputeaSwissInTheUS has a reputation beyond reputeaSwissInTheUS has a reputation beyond reputeaSwissInTheUS has a reputation beyond reputeaSwissInTheUS has a reputation beyond reputeaSwissInTheUS has a reputation beyond repute
Re: Pension calculation

The bare minimum contributions (covered 50/50 employee/employer)

AGE % of coordinated pay check 25-34 7 35-44 10 45-54 15 55-65 18
Coordinated pay check is: Annual_Net_Income - CHF 24675 but not more than CHF 59925.–
Reply With Quote
  #24  
Old 14.05.2019, 12:03
Newbie 1st class
 
Join Date: Feb 2019
Location: UK
Posts: 11
Groaned at 0 Times in 0 Posts
Thanked 3 Times in 1 Post
Bright Side has no particular reputation at present
Re: Pension calculation

Quote:
View Post
Up to a max of 85k the employer must pay a minimum % into the pension, they must match your personal contribution. After 85k gross earnings this is a bit grey and is a kind of bonus if you get pension payment on that.

6k a month is less than the 85k max limit

35-44 years old is 7% therefore 3.5% each
45-54 is 15% so 7.5% each
55-65 is 18% so 9% each

Which yes ok is a 7.5% average. But its unlikely unless you are contracting/consulting you would only get 3.5% from the employer
At the age 35-44, can I pay like 10% and the employer pay their 3.5% ?

Thank you.
Reply With Quote
  #25  
Old 14.05.2019, 12:21
fatmanfilms's Avatar
Forum Legend
 
Join Date: Apr 2010
Location: Verbier
Posts: 17,844
Groaned at 282 Times in 231 Posts
Thanked 15,251 Times in 8,476 Posts
fatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond repute
Re: Pension calculation

Quote:
View Post
Up to a max of 85k the employer must pay a minimum % into the pension, they must match your personal contribution. After 85k gross earnings this is a bit grey and is a kind of bonus if you get pension payment on that.

6k a month is less than the 85k max limit

35-44 years old is 7% therefore 3.5% each
45-54 is 15% so 7.5% each
55-65 is 18% so 9% each

Which yes ok is a 7.5% average. But its unlikely unless you are contracting/consulting you would only get 3.5% from the employer
Not on the full 85K either. Many companies pay min required by law .
Reply With Quote
  #26  
Old 14.05.2019, 13:18
aSwissInTheUS's Avatar
Forum Legend
 
Join Date: Nov 2007
Location: Zurich area
Posts: 10,122
Groaned at 78 Times in 69 Posts
Thanked 15,279 Times in 6,795 Posts
aSwissInTheUS has a reputation beyond reputeaSwissInTheUS has a reputation beyond reputeaSwissInTheUS has a reputation beyond reputeaSwissInTheUS has a reputation beyond reputeaSwissInTheUS has a reputation beyond reputeaSwissInTheUS has a reputation beyond repute
Re: Pension calculation

Quote:
View Post
At the age 35-44, can I pay like 10% and the employer pay their 3.5% ?
Within the first 5 years of moving to Switzerland you can contribute up to an additional 20%. After that you can contribute as much as you like.

But in both cases you can not add more than a hypothetical person would have in the pot if they had contributed the maximum permitted by the current pension plan, and current pay check.

If you look at an employer and its pension plan:
-check how much the coordination deduction is (permitted is up to 7∕8 of a full AHV pension).
- check if the there is a cap on the insured pay check (it can be as low as 3 times a full AHV pension)
- check how much more employee and employer contribute over the bare minimum.
- check past performance and interest payouts
- check pension conversion rate for the non-mandatory part (in the worst you could still opt for the lump sum)
__________________
“That’s the second biggest monkey head I’ve ever seen!”
Reply With Quote
The following 2 users would like to thank aSwissInTheUS for this useful post:
  #27  
Old 14.05.2019, 17:36
Junior Member
 
Join Date: Jul 2012
Location: Zurich
Posts: 62
Groaned at 3 Times in 2 Posts
Thanked 38 Times in 22 Posts
Fijiman has made some interesting contributions
Re: Pension calculation

Quote:
View Post
Within the first 5 years of moving to Switzerland you can contribute up to an additional 20%. After that you can contribute as much as you like.

But in both cases you can not add more than a hypothetical person would have in the pot if they had contributed the maximum permitted by the current pension plan, and current pay check.

If you look at an employer and its pension plan:
-check how much the coordination deduction is (permitted is up to 7∕8 of a full AHV pension).
- check if the there is a cap on the insured pay check (it can be as low as 3 times a full AHV pension)
- check how much more employee and employer contribute over the bare minimum.
- check past performance and interest payouts
- check pension conversion rate for the non-mandatory part (in the worst you could still opt for the lump sum)
1st 5 years, 20% catchup (based upon elegible salary net of 28k)
After 5 years, 50% catchup (same basis as above)

The catchups are separate from your mandatory contributions to the Pillar 2 (currently 10% for me) and separate from your employer contributions (currently 15% for me), and separate from your contributions to Pillar 1 ("basic" social security) and Pillar 3 (6800 chf annual limit)

Taxes on withdrawals when you retire or leave the country are very low. If you withdraw a lump sum, you pay basically 5%. If you withdraw as a lifetime annuity you pay basically 40% of regular income tax rates.

The downside is that the investment "returns" on your balance are low. If you are close to retirement (in your 40's or 50's) the tax savings more than make up for the lost investment income. If you are younger (30's) better to wait until your 40's or 50's before you make catchup contributions.

Long story short, the Swiss pension system provides excellent flexibility for late career expats to minimize income taxes.

regards
fj
Reply With Quote
  #28  
Old 14.05.2019, 18:03
omtatsat's Avatar
Forum Legend
 
Join Date: Oct 2007
Location: Timbuktoo/Zürich
Posts: 7,802
Groaned at 1,440 Times in 777 Posts
Thanked 3,324 Times in 2,123 Posts
omtatsat omtatsat omtatsat omtatsat omtatsat
Re: Pension calculation

Quote:
View Post
Hi,
I have a question regarding pension please.
How much would approximately a married person who worked in Switzerland for 25 years before retiring with a salary of 6000 CHF/month get as a pension /month ?

How much extra can I pay in the second pillar so I can increase my pension ?

Thank you.

With kind regards
Your pension with 25 years work would probably not be enough to live from
Reply With Quote
This user groans at omtatsat for this post:
  #29  
Old 14.05.2019, 18:19
fatmanfilms's Avatar
Forum Legend
 
Join Date: Apr 2010
Location: Verbier
Posts: 17,844
Groaned at 282 Times in 231 Posts
Thanked 15,251 Times in 8,476 Posts
fatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond repute
Re: Pension calculation

Full disclosure I paid 38,000 into a 2nd pillar 10 years before leaving CH. Basically zero growth it was a waste of time, S&P500 would have been better, Fundsmith did not exist at the time.
Quote:
View Post
Your pension with 25 years work would probably not be enough to live from
I worked in CH for 19 years & 11 months, my pension taken as cash is about 2-3 years average expenditure since living in Malta for the last 5 years. OK I got married so my costs went up astronomically
Reply With Quote
  #30  
Old 14.05.2019, 18:43
omtatsat's Avatar
Forum Legend
 
Join Date: Oct 2007
Location: Timbuktoo/Zürich
Posts: 7,802
Groaned at 1,440 Times in 777 Posts
Thanked 3,324 Times in 2,123 Posts
omtatsat omtatsat omtatsat omtatsat omtatsat
Re: Pension calculation

Why the groan. After 25 years work and at 72000 a year brutto he would not be getting more than 2000 a month pension ( at the most )
Reply With Quote
  #31  
Old 14.05.2019, 18:44
Fish Paste's Avatar
Forum Veteran
 
Join Date: Jun 2013
Location: North
Posts: 1,049
Groaned at 39 Times in 24 Posts
Thanked 1,290 Times in 595 Posts
Fish Paste has a reputation beyond reputeFish Paste has a reputation beyond reputeFish Paste has a reputation beyond reputeFish Paste has a reputation beyond repute
Re: Pension calculation

This may or not be correct, nor relevant, but here goes.


I believe, if you overpay your Pillar 2 (catch up) you cannot liberate it so quickly when you leave CH.



I thought it was locked in for X amount of years, or needs to have been in the fund for X amount of years before you can get it.



So eg. FMF, a lump sum 10 years ago could be taken out on emmigration.

A lump sum last year cannot.
Reply With Quote
  #32  
Old 14.05.2019, 18:58
22 yards's Avatar
Only in moderation
 
Join Date: Jul 2009
Location: Basel-Land
Posts: 8,366
Groaned at 244 Times in 197 Posts
Thanked 15,534 Times in 6,417 Posts
22 yards has a reputation beyond repute22 yards has a reputation beyond repute22 yards has a reputation beyond repute22 yards has a reputation beyond repute22 yards has a reputation beyond repute22 yards has a reputation beyond repute
Re: Pension calculation

Quote:
View Post
The Swiss government old-age pension can be estimated using the calculator available at this link. It can be done in English:

https://www.ahv-iv.ch/en/Leaflets-fo...estimate-ESCAL
Thanks for this. I just used the calculator and got the bad news after filling in details for myself and my wife. It's given me estimates for:

  • First pension: commences the month after my 65th birthday and continues until the month of my wife's 64th birthday, when it is replaced by:
  • Second pension: commences the month after my wife's 64th birthday, with one pension for me and one for her, but both pensions are capped because "the sum of two individual pensions of a couple may not exceed 150% of the maximum individual pension". WTF??!?! I mean, I knew about the income tax discrimination with regard to married couples, but pensions, as well? I don't see our pension contributions being capped...!

Does this mean that two people who do not marry, but live together, would receive their full, individual pensions for the rest of their lives while the married couple next door gets screwed?
__________________
Windmill cancer survivor (thanks, George!)
Reply With Quote
  #33  
Old 14.05.2019, 19:27
Forum Veteran
 
Join Date: Aug 2011
Location: Bern
Posts: 800
Groaned at 5 Times in 4 Posts
Thanked 1,179 Times in 482 Posts
heckenhocker has a reputation beyond reputeheckenhocker has a reputation beyond reputeheckenhocker has a reputation beyond reputeheckenhocker has a reputation beyond reputeheckenhocker has a reputation beyond repute
Re: Pension calculation

Quote:
View Post
No, it's not a guess.

See previous post.
Oh goody.... no changes in pension entitlement / accrual / payout rates / retirement age over the next 25 years then? Can I have that in writing with a binding guarantee?
Reply With Quote
This user would like to thank heckenhocker for this useful post:
  #34  
Old 14.05.2019, 19:27
omtatsat's Avatar
Forum Legend
 
Join Date: Oct 2007
Location: Timbuktoo/Zürich
Posts: 7,802
Groaned at 1,440 Times in 777 Posts
Thanked 3,324 Times in 2,123 Posts
omtatsat omtatsat omtatsat omtatsat omtatsat
Re: Pension calculation

Quote:
View Post
Thanks for this. I just used the calculator and got the bad news after filling in details for myself and my wife. It's given me estimates for:

  • First pension: commences the month after my 65th birthday and continues until the month of my wife's 64th birthday, when it is replaced by:
  • Second pension: commences the month after my wife's 64th birthday, with one pension for me and one for her, but both pensions are capped because "the sum of two individual pensions of a couple may not exceed 150% of the maximum individual pension". WTF??!?! I mean, I knew about the income tax discrimination with regard to married couples, but pensions, as well? I don't see our pension contributions being capped...!

Does this mean that two people who do not marry, but live together, would receive their full, individual pensions for the rest of their lives while the married couple next door gets screwed?
For married its a slight reduction of the unmarried pension. In your case not very much.
Reply With Quote
  #35  
Old 14.05.2019, 19:40
omtatsat's Avatar
Forum Legend
 
Join Date: Oct 2007
Location: Timbuktoo/Zürich
Posts: 7,802
Groaned at 1,440 Times in 777 Posts
Thanked 3,324 Times in 2,123 Posts
omtatsat omtatsat omtatsat omtatsat omtatsat
Re: Pension calculation

this might help

https://www.ch.ch/en/retirement-provision-system/
Reply With Quote
This user would like to thank omtatsat for this useful post:
  #36  
Old 14.05.2019, 20:04
John_H's Avatar
Forum Legend
 
Join Date: May 2013
Location: Nyon
Posts: 2,838
Groaned at 77 Times in 45 Posts
Thanked 3,444 Times in 1,366 Posts
John_H has a reputation beyond reputeJohn_H has a reputation beyond reputeJohn_H has a reputation beyond reputeJohn_H has a reputation beyond reputeJohn_H has a reputation beyond repute
Re: Pension calculation

I got my annual statement in today for my pension..

Lots of numbers but something which confused me more than the rest..

Retirement capital : ok the amount I have in the pot.
Amount available for encouragement of home ownership : ok same as above
Maximum amount for purchase : ?? 3.3 x the amount amount above

So what's that maximum amount number? The max price of a house i could buy? Or some theoretical other amount available to me?
Reply With Quote
  #37  
Old 14.05.2019, 20:16
roegner's Avatar
Moderately Dutch
 
Join Date: May 2011
Location: Zurich
Posts: 8,530
Groaned at 298 Times in 245 Posts
Thanked 9,136 Times in 4,625 Posts
roegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond repute
Re: Pension calculation

Quote:
View Post
I got my annual statement in today for my pension..

Lots of numbers but something which confused me more than the rest..

Retirement capital : ok the amount I have in the pot.
Amount available for encouragement of home ownership : ok same as above
Maximum amount for purchase : ?? 3.3 x the amount amount above

So what's that maximum amount number? The max price of a house i could buy? Or some theoretical other amount available to me?
If it is Pillar 2, it is the amount you can still put in the retirement pot
Reply With Quote
  #38  
Old 14.05.2019, 20:19
John_H's Avatar
Forum Legend
 
Join Date: May 2013
Location: Nyon
Posts: 2,838
Groaned at 77 Times in 45 Posts
Thanked 3,444 Times in 1,366 Posts
John_H has a reputation beyond reputeJohn_H has a reputation beyond reputeJohn_H has a reputation beyond reputeJohn_H has a reputation beyond reputeJohn_H has a reputation beyond repute
Re: Pension calculation

Quote:
View Post
If it is Pillar 2, it is the amount you can still put in the retirement pot
Ahh of course, that makes sense.. Thanks..

Maybe I try to fill my pot a little more with my UK pensions..
Now where's that number for devere..
Reply With Quote
  #39  
Old 14.05.2019, 20:22
roegner's Avatar
Moderately Dutch
 
Join Date: May 2011
Location: Zurich
Posts: 8,530
Groaned at 298 Times in 245 Posts
Thanked 9,136 Times in 4,625 Posts
roegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond reputeroegner has a reputation beyond repute
Re: Pension calculation

Quote:
View Post
Ahh of course, that makes sense.. Thanks..

Maybe I try to fill my pot a little more with my UK pensions..
Now where's that number for devere..
Reply With Quote
  #40  
Old 14.05.2019, 20:36
22 yards's Avatar
Only in moderation
 
Join Date: Jul 2009
Location: Basel-Land
Posts: 8,366
Groaned at 244 Times in 197 Posts
Thanked 15,534 Times in 6,417 Posts
22 yards has a reputation beyond repute22 yards has a reputation beyond repute22 yards has a reputation beyond repute22 yards has a reputation beyond repute22 yards has a reputation beyond repute22 yards has a reputation beyond repute
Re: Pension calculation

Quote:
View Post
For married its a slight reduction of the unmarried pension. In your case not very much.
If an average 25% reduction is a mere scintilla to you, then yeah, it's "not very much".
Reply With Quote
Reply

Tags
pension




Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Pension enquiry - Defined Benefit Pension vs Defined Contribution Pension PeterSoliman Finance/banking/taxation 21 05.09.2018 11:34
Swiss pension calculation hardtec Finance/banking/taxation 3 19.12.2011 23:26
Divorce and Pension Funds Calculation newinhere Finance/banking/taxation 6 15.12.2011 08:31
UK Final Salary Pension vs New Pension in Switzerland Nick_Stone12358 Finance/banking/taxation 4 14.12.2010 18:01
Working conditions/RAV calculation for unemployment pension/ quiting job lucy_sg Employment 5 19.03.2008 20:01


All times are GMT +2. The time now is 05:15.


Powered by vBulletin® Version 3.8.4
Copyright ©2000 - 2019, Jelsoft Enterprises Ltd.
LinkBacks Enabled by vBSEO 3.1.0