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  #61  
Old 04.08.2021, 09:59
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Re: 3a pillar vs personal investing

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And yet the return on my CS Mixta 75 that I opened at the same time as my VIAC is broadly similar. You aren’t comparing apples with even another fruit when you compare two different timeframes and different asset mixes.
Mine was CS Mixta 45 which was the highest percentage of stocks I could include when I bought it. Perhaps the 75% version is more recent? Yes, I'm comparing two different asset mixes but that's the point -- I couldn't make a choice of assets when I bought the Mixta 45 whereas with VIAC I have quite a range of funds, sectors, and geographies, and can choose my own percentages. Anyway, the Mixta 45 did indeed go up in value over the period and was much better than my first couple of years of 3A when the pot was in low-interest cash. But it was still slower than I hoped and am glad that I've switched to VIAC. Finpension sounds good as well but I won't switch from where I am as I'm not far from pension age.
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  #62  
Old 04.08.2021, 12:15
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Re: 3a pillar vs personal investing

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When did she invest & what is the return since inception is more interesting.
Following the rule that we shouldn't have more than 50k in one 3a account, it was anyway an account that we just left alone at another bank. By end 2019 UBS gave us some carrot to move it over and it was invested in 3 separate amounts in early Jan, Feb and March 2020 at unit prices of around 100. Now the unit price is above 130.

The point I was making - taking a sample period of between March 2020 and today, anyone can show decent returns...

The reality is that the fund is just under 3 years old and the return per annum is "only" 14% so far, including the latest bull run.
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  #63  
Old 04.08.2021, 13:16
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Re: 3a pillar vs personal investing

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My wife‘s Vitainvest at UBS has returned 31% since March 2020.
Whilst the SP500 and Nasdaq have c. doubled...
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  #64  
Old 04.08.2021, 13:52
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Re: 3a pillar vs personal investing

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Whilst the SP500 and Nasdaq have c. doubled...
From early march 2020... SP500 is only around 50% up. Not double. You need to time the market just right to get double.

Again, I was just supporting the point that comparisons given by various posters here is not apples to apples. Just saying that even the UBS Vitainvest looks good if I choose a favourable time period.

If I look at the low point of Vitainvest in March 2020, then it is now almost 70% up!
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  #65  
Old 04.08.2021, 13:57
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Re: 3a pillar vs personal investing

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Following the rule that we shouldn't have more than 50k in one 3a account....
I've never heard this rule. Is this a tax issue? Or do you just mean it's a good idea to diversify?
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  #66  
Old 04.08.2021, 14:12
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Re: 3a pillar vs personal investing

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I've never heard this rule. Is this a tax issue? Or do you just mean it's a good idea to diversify?
Generally it is wise to have multiple accounts so that you don't attract progressive tax when you have to withdraw a lump sum.

Maybe the 50k is my own calculation. Say a savings of average just under 7k for 30 years = around 200k. You can withdraw from 5 years before retirement, so split it over 5 years means about 40k in each account. I give it some room to grow, so 50k.

That's just my thinking.

Some people (like thepoorswiss) say 20k is the max per account, but I never figured out why.
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  #67  
Old 04.08.2021, 14:34
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Re: 3a pillar vs personal investing

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Generally it is wise to have multiple accounts so that you don't attract progressive tax when you have to withdraw a lump sum.

Maybe the 50k is my own calculation. Say a savings of average just under 7k for 30 years = around 200k. You can withdraw from 5 years before retirement, so split it over 5 years means about 40k in each account. I give it some room to grow, so 50k.

That's just my thinking.

Some people (like thepoorswiss) say 20k is the max per account, but I never figured out why.
It‘s about the marginal tax. In Schwyz the tax is flat up until 30k and then starts increasing. Admitedly at SZ rates it‘s penny pinching a bit, but every little helps.

I was sad enough to draw up a table once.
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  #68  
Old 04.08.2021, 16:24
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Re: 3a pillar vs personal investing

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Generally it is wise to have multiple accounts so that you don't attract progressive tax when you have to withdraw a lump sum.

Maybe the 50k is my own calculation. Say a savings of average just under 7k for 30 years = around 200k. You can withdraw from 5 years before retirement, so split it over 5 years means about 40k in each account. I give it some room to grow, so 50k.

That's just my thinking.

Some people (like thepoorswiss) say 20k is the max per account, but I never figured out why.
I guess it is a tax advantage to be more than 5 years younger/older than your partner - then you get 10 between you!
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  #69  
Old 04.08.2021, 18:54
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Re: 3a pillar vs personal investing

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Some people (like thepoorswiss) say 20k is the max per account, but I never figured out why.
The SPI alone has performed ~8% annually over the 25 years since its introduction (thru Dec 2020), let's say that's what you get in the future as well.

If the first 6 annual contributions go into the same account, that's ~41k (for simplicity's sake the growth during these years is ignored). After another 18 years that's grown to ~160k, and the following year's 8% will amount to 12'800.

At that point the first account will outgrow whatever you can achieve with contributions to the latest account. The "point of no return" was reached earlier, but that's beside the point.

Thus the way to go is to open all five (the optimum may be six, actually, I seem to remember that the payout can happen from age 65 to 70 including) and add to whichever is lowest (or spread among many each year, if that's accepted. It probably is, but it's better to ask first. Though the one paid out last has five additional years go grow, based on the assumed 8% that's almost 50% on top).

PS: SPI Extra has returned 10.4% over the same 25 years.
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Old 04.08.2021, 20:54
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Re: 3a pillar vs personal investing

From 1970 the S&P has grown at 8.256% compound however with dividends reinvested its 11.356%

The 100 year growth is 6.712% or 10.863% compound

https://dqydj.com/sp-500-return-calculator/

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The SPI alone has performed ~8% annually over the 25 years since its introduction (thru Dec 2020), let's say that's what you get in the future as well.

If the first 6 annual contributions go into the same account, that's ~41k (for simplicity's sake the growth during these years is ignored). After another 18 years that's grown to ~160k, and the following year's 8% will amount to 12'800.

At that point the first account will outgrow whatever you can achieve with contributions to the latest account. The "point of no return" was reached earlier, but that's beside the point.

Thus the way to go is to open all five (the optimum may be six, actually, I seem to remember that the payout can happen from age 65 to 70 including) and add to whichever is lowest (or spread among many each year, if that's accepted. It probably is, but it's better to ask first. Though the one paid out last has five additional years go grow, based on the assumed 8% that's almost 50% on top).

PS: SPI Extra has returned 10.4% over the same 25 years.
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  #71  
Old 04.08.2021, 21:08
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Re: 3a pillar vs personal investing

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From 1970 the S&P has grown at 8.256% compound however with dividends reinvested its 11.356%

The 100 year growth is 6.712% or 10.863% compound

https://dqydj.com/sp-500-return-calculator/
How much is that in CHF?
IIRC the USD went for around 4 CHF during Bretton Woods (or a bit more), BW was abolished in the early 70ies (1972 ?). Using a simple start-end devaluation that looks like an annual drag of around 2.5-3%. Though of course the combination (stock price increase and USD devaluation) may differ.
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  #72  
Old 04.08.2021, 21:15
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Re: 3a pillar vs personal investing

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How much is that adjusted to CHF?
IIRC the USD went for around 4 CHF during Bretton Woods (or a bit higher), BW was abolished in the early 70ies (1972 ?). Using a simple start-end devaluation that looks like an annual drag of around 2.5-3%.
If you take a 10 year view, the results are higher with CHF as the valuation currency. Difficult to know what the next 10 years will bring.
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  #73  
Old 04.08.2021, 22:09
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Re: 3a pillar vs personal investing

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How much is that in CHF?
If the USDCHF FX rate in July 1970 (51 years) was 4, an 11.356% annual return with dividends reinvested in USD would be a smidge over 8% in CHF.
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Old 13.08.2021, 20:19
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Re: 3a pillar vs personal investing

VIAC Swiss 100, invested April 2020 is above 50% return - but that is by the by. The better news is that they are rebalancing weekly and not monthly from next month, if you want to change your strategy. Finpension announced last month that they will be trading daily. Why anybody would go for 'traditional' 3rd pillar at max 1% per year, I have no clue. This is about the same as Vitainvest has managed since 2006.
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Old 13.08.2021, 20:34
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Re: 3a pillar vs personal investing

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VIAC Swiss 100, invested April 2020 is above 50% return - but that is by the by. The better news is that they are rebalancing weekly and not monthly from next month, if you want to change your strategy. Finpension announced last month that they will be trading daily. Why anybody would go for 'traditional' 3rd pillar at max 1% per year, I have no clue. This is about the same as Vitainvest has managed since 2006.
Balancing is the worst part of the strategy. Why would you would sell the winners to invest in the losers automatically beats me.
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Old 13.08.2021, 20:58
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Re: 3a pillar vs personal investing

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Balancing is the worst part of the strategy. Why would you would sell the winners to invest in the losers automatically beats me.
it's useful because if you put in new cash, you can end up having to wait a month before it is invested.
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  #77  
Old 13.08.2021, 21:09
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Re: 3a pillar vs personal investing

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Balancing is the worst part of the strategy. Why would you would sell the winners to invest in the losers automatically beats me.
Possible with finpension to just have the one fund. That's what I'm doing (MSCI World quality ex-CH)

I don't like the way viac enforces Swiss equities and/or hedging on you. Why not let the Investor make the decision?

The minute someone let's you invest 100% in the nasdaq 100 im in.
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Old 13.08.2021, 23:08
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Re: 3a pillar vs personal investing

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Balancing is the worst part of the strategy. Why would you would sell the winners to invest in the losers automatically beats me.
I don't but the option to switch within a week rather than month to something more aggressive, is a good one?
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Old 13.08.2021, 23:10
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Re: 3a pillar vs personal investing

Just got an email from viac saying they are introducing INRG (clean energy etf) as an option.

That's a bit different - getting towards the racier end of equities. Going to be an interesting decision whether to go with finpension or viac now.
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Old 14.08.2021, 09:27
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Re: 3a pillar vs personal investing

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It‘s about the marginal tax. In Schwyz the tax is flat up until 30k and then starts increasing. Admitedly at SZ rates it‘s penny pinching a bit, but every little helps.

I was sad enough to draw up a table once.
If you are below 50 & are investing in Equities, I would suggest you would need to open a new account each year to stay below 50K, however if you can only cash in 1 account a year the strategy won't work either.
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