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Old 20.03.2021, 16:06
hoover1
 
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Re: Very confused about pension withdrawl upon leaving! Help!

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What exactly about this differences in currency drastically changes this?

20 years ago to acquire 10k USD you'd have spent 19k CHF
20 years later you likely to get 9K CHF from 10K USD - making it 50% lost on currency.


So overall one might have won 400% of investment over 20-years on SP500 index with two financial meltdowns and dot-com crash (either not bailed out - one would be empty handed).


now on Pillar 2A side - The minimal interest rate is supposed to reflect market conditions from a relatively risk averse perspective

Table 33: Evolution BVG minimum interest rate
1985 - 2002 2003 2004 2005
4% 3.25% 2.25% 2.5%


Now, as far I remember I had 6% interest rates guaranteed until 2010 or so .. and zero risk - which model fits better is personal choice - secure&safe vs rock&roll investment.

Uploaded document I have found that may be of help also looking beyond pure investment position.
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File Type: pdf HP-2005-Buetler-2.pdf (824.4 KB, 27 views)
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  #22  
Old 20.03.2021, 16:17
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Re: Very confused about pension withdrawl upon leaving! Help!

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20 years ago to acquire 10k USD you'd have spent 19k CHF
20 years later you likely to get 9K CHF from 10K USD - making it 50% lost on currency.


So overall one might have won 400% of investment over 20-years on SP500 index with two financial meltdowns and dot-com crash (either not bailed out - one would be empty handed).


now on Pillar 2A side - The minimal interest rate is supposed to reflect market conditions from a relatively risk averse perspective

Table 33: Evolution BVG minimum interest rate
1985 - 2002 2003 2004 2005
4% 3.25% 2.25% 2.5%


Now, as far I remember I had 6% interest rates guaranteed until 2010 or so .. and zero risk - which model fits better is personal choice - secure&safe vs rock&roll investment.

Uploaded document I have found that may be of help also looking beyond pure investment position.
The 6% is an annuity rate, not a growth rate so if you live 16 2/3 years you get the original sum without any growth. Being that life expectancy for a man aged 65 was 18.8 years in 2010 in CH it's hardly a good return. Life expectancy now would be 20 years.
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  #23  
Old 20.03.2021, 17:03
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Re: Very confused about pension withdrawl upon leaving! Help!

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The 6% is an annuity rate, not a growth rate so if you live 16 2/3 years you get the original sum without any growth. Being that life expectancy for a man aged 65 was 18.8 years in 2010 in CH it's hardly a good return. Life expectancy now would be 20 years.
I still think the best use of pillar 2 is to pay off the mortgage.
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  #24  
Old 20.03.2021, 17:27
hoover1
 
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Re: Very confused about pension withdrawl upon leaving! Help!

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The 6% is an annuity rate, not a growth rate so if you live 16 2/3 years you get the original sum without any growth. Being that life expectancy for a man aged 65 was 18.8 years in 2010 in CH it's hardly a good return. Life expectancy now would be 20 years.
you just made me look back into my digitalised paper of 2A from back 2010 - and it's "growth rate" at leat for me - as compounded annualised rate of growth .[deleted]... strange numbers - when compared against current 2A it's like ... 3x less I be getting when retired ...hmmm.. likley won't make there with COVID and constant visits to fridge anyway so be it .

I guess 2A is different by provider and negotiated by company so milage may ...

Last edited by hoover1; 20.03.2021 at 17:54. Reason: 56% statment correction
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