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Old 26.03.2021, 00:31
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Second pillar costs and consolidation

Hi everyone!
As I changed jobs often, and rarely took the necessary care to transfer the second pillar funds to the new accounts (trying to rectify this, and cleaning up my life in general), I now have numerous accounts with small amounts, where they charge fees so high that it eats up those savings so quickly that it makes my stomach turn .
What are your recommended strategies?
Would it be ok to take the ones charging fees and parking them at the https://web.aeis.ch/ ? It seems like at least they are not charging any fees...
How many accounts is one supposed to keep?
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Old 26.03.2021, 07:32
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Re: Second pillar costs and consolidation

Do you have a job now with pension fund contribution? The obvious choice would be to move everything into this fund.
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Old 26.03.2021, 08:39
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Re: Second pillar costs and consolidation

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Hi everyone!
As I changed jobs often, and rarely took the necessary care to transfer the second pillar funds to the new accounts (trying to rectify this, and cleaning up my life in general), I now have numerous accounts with small amounts, where they charge fees so high that it eats up those savings so quickly that it makes my stomach turn .
What are your recommended strategies?
Would it be ok to take the ones charging fees and parking them at the https://web.aeis.ch/ ? It seems like at least they are not charging any fees...
How many accounts is one supposed to keep?
You are supposed to only have one - but I'd move all into valuepension and invest 100% into equities - https://www.valuepension.ch/, which is the best cost option in ch.
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Old 26.03.2021, 08:40
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Re: Second pillar costs and consolidation

If you are employed now and you have a second pillar, I think you are legally obliged to put it there - that is what VIAC told me when trying to open the libre vested account with them.
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Old 26.03.2021, 08:45
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Re: Second pillar costs and consolidation

Move your Pillar 2 investments to VIAC or finpension
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Old 26.03.2021, 09:12
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Re: Second pillar costs and consolidation

I had my vested benefit account open for several years. So either there was an oversight, or you don't have to transfer into your employer's so long as you leave it in a protected account.
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Old 26.03.2021, 09:36
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Re: Second pillar costs and consolidation

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I had my vested benefit account open for several years. So either there was an oversight, or you don't have to transfer into your employer's so long as you leave it in a protected account.
You're supposed to, but if you don't it's 'your' problem & nobody cares. Returns in co schemes have a guaranteed return & hence are invested to meet that guarantee at the expense of a better investment return.
I had 2 for over 10 years nobody even noticed or even knew as far as I know.
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Old 26.03.2021, 13:51
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Re: Second pillar costs and consolidation

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If you are employed now and you have a second pillar, I think you are legally obliged to put it there - that is what VIAC told me when trying to open the libre vested account with them.
Well if he changes job frequently I'd wait until he is between jobs then transfer. The difference between VIAC / Valuepension (aka finpension) and workplace pillar 2 will be very large compounded over many years.
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Old 26.03.2021, 15:08
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Re: Second pillar costs and consolidation

This might help:
https://www.moneyland.ch/en/vested-b...nts-comparison

AFAIK, one can only have one 2nd Pillar account. It's the law. Don't know how it may be handled come time for distribution?
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Old 26.03.2021, 15:17
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Re: Second pillar costs and consolidation

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This might help:
https://www.moneyland.ch/en/vested-b...nts-comparison

AFAIK, one can only have one 2nd Pillar account. It's the law. Don't know how it may be handled come time for distribution?
No issue I distributed when I left CH
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Old 26.03.2021, 16:05
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Re: Second pillar costs and consolidation

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Well if he changes job frequently I'd wait until he is between jobs then transfer. The difference between VIAC / Valuepension (aka finpension) and workplace pillar 2 will be very large compounded over many years.
Many 2nd pillar regulations say that if you have a libre passage account you must transfer it in upon joining the foundation.

I get that people may get away with not doing it and all, just does not make the rules different.
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Old 26.03.2021, 18:53
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Re: Second pillar costs and consolidation

Thank you for all your insights. Right now I am not employed in Switzerland, so free, if I understand you correctly.
Hm, do I see this right, the VIAC option is from WIR bank?
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Old 26.03.2021, 18:55
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Re: Second pillar costs and consolidation

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Thank you for all your insights. Right now I am not employed in Switzerland, so free, if I understand you correctly.
Hm, do I see this right, the VIAC option is from WIR bank?
Valuepension is generally considered to be slightly better (slightly cheaper, higher % equities, better FX rates). An added benefit for expats is that if you ever leave Switzerland its based in low tax Schwyz - so withdrawing it would be more tax efficient than if you went with VIAC (in high tax Basel Stadt). See https://investinghero.ch/viac-vs-valuepension/

https://www.valuepension.ch/

VIAC is associated with WIR bank yes.
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Old 26.03.2021, 19:34
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Re: Second pillar costs and consolidation

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Many 2nd pillar regulations say that if you have a libre passage account you must transfer it in upon joining the foundation.

I get that people may get away with not doing it and all, just does not make the rules different.
They never gave me the rules in English (or even German TBH), I never bothered to enquire their 'rules', I never signed anything to accept their rules, so don't see how I had to know or abide by them.
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Old 26.03.2021, 21:47
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Re: Second pillar costs and consolidation

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They never gave me the rules in English (or even German TBH), I never bothered to enquire their 'rules', I never signed anything to accept their rules, so don't see how I had to know or abide by them.
When you join a new company one of the forms included in the starter pack is a form that you are to use transfer your existing savings to the new pension fund and it is stated there.

Nobody in officialdom cares because the only people impact by your failure to do so is you and your dependents. Youíll be under insured in terms of incapacity and death benefits and unable to access any of the other accounts until you reach 60 years of age.
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Old 27.03.2021, 05:57
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Re: Second pillar costs and consolidation

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When you join a new company one of the forms included in the starter pack is a form that you are to use transfer your existing savings to the new pension fund and it is stated there.

Nobody in officialdom cares because the only people impact by your failure to do so is you and your dependents. Youíll be under insured in terms of incapacity and death benefits and unable to access any of the other accounts until you reach 60 years of age.
Are you sure about underinsurance? In my plan that is a pure risk benefit and it's a % of the insured salary regardless of the total capital I have in the plan. I recently asked the pension foundation to do a simulation of how the risk benefits change with a buy back and they confirmed that they don't. So perhaps it depends on the plans? Curious about this.
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Old 27.03.2021, 06:04
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Re: Second pillar costs and consolidation

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When you join a new company one of the forms included in the starter pack is a form that you are to use transfer your existing savings to the new pension fund and it is stated there.

Nobody in officialdom cares because the only people impact by your failure to do so is you and your dependents. You’ll be under insured in terms of incapacity and death benefits and unable to access any of the other accounts until you reach 60 years of age.
I think it's generally a good idea to not mix up insurance and investment products.

You are absolutely correct that most people are underinsured against incapacity - but for most of us expats pillar 2 is insufficient for that purpose anyhow as we have small amounts relative to our incomes and outgoings.

Ultimately in company pillar 2, the investments are low return and what return you have is taken from you and given to pensioners. Thus you have investment risk without reward. Your money saved will likely be eaten away by inflation. As a young person as far as I see:

a) withdrawing for property;
b) making your own retirement savings,
c) if you have dependents, purchasing an insurance policy

Is a much better way to go.

Last edited by HickvonFrick; 27.03.2021 at 06:42.
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Old 27.03.2021, 08:28
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Re: Second pillar costs and consolidation

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I think it's generally a good idea to not mix up insurance and investment products.

You are absolutely correct that most people are underinsured against incapacity - but for most of us expats pillar 2 is insufficient for that purpose anyhow as we have small amounts relative to our incomes and outgoings.

Ultimately in company pillar 2, the investments are low return and what return you have is taken from you and given to pensioners. Thus you have investment risk without reward. Your money saved will likely be eaten away by inflation. As a young person as far as I see:

a) withdrawing for property;
b) making your own retirement savings,
c) if you have dependents, purchasing an insurance policy

Is a much better way to go.
I agree! I have started looking into this - the worst case scenario aspect - and ita very complicated! Do you know good insurances for point c)? Maybe this is one for a separate thread!
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Old 27.03.2021, 08:34
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Re: Second pillar costs and consolidation

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I think Ultimately in company pillar 2, the investments are low return and what return you have is taken from you and given to pensioners.
I spent over ten years doing performance and attribution analysis in the Swiss pension industry and the one thing that never fails to amaze is peopleís perception of their investing skills versus reality. If left to their own devices probably one in ten will even achieve those so called low returns, the rest will be lucky to come out with the money they put in and probably would not be covered at all for incapacity.

Iím very much in favor of the Swiss pension system because by forcing people to save for retirement, it means that my pension savings will not be raided in the future to support them.
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Old 27.03.2021, 08:42
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Re: Second pillar costs and consolidation

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I spent over ten years doing performance and attribution analysis in the Swiss pension industry and the one thing that never fails to amaze is peopleís perception of their investing skills versus reality. If left to their own devices probably one in ten will even achieve those so called low returns, the rest will be lucky to come out with the money they put in and probably would not be covered at all for incapacity.

Iím very much in favor of the Swiss pension system because by forcing people to save for retirement, it means that my pension savings will not be raided in the future to support them.
I fully agree with this for the basic pillar 2, but it would be good to have a tax efficient way of investing more if desired, i.e. a higher limit on 3a and more flexibility.
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