Comparative 3rd pillar: The complete guide

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In Switzerland, the third pillar offers you the opportunity to build up an interesting retirement provision, in addition to the first and second pillars. But, did you know that this type of contract comes in various forms and can be opened with both banks and insurance companies? Do you know the differences between these providers? The rates they offer? The advantages offered? Here we help you make a comparison of each 3rd pillar and what they have to offer you.

Institution	Annual fee*
True Wealth	0,2%	Go to website
Finpension	from 0,39% to 0.42%	Go to website
Frankly	0,45%	Go to website
VIAC	from 0 to 0,53%	Go to website
Tellco	from 0.39% to 0,71%	Go to website
Inyova	0,8%	Go to website
Pando	0.99%	Go to website

*Annual fees are quoted on each institution's respective website.

Why make a 3rd pillar comparison?

The Swiss provident account, also known as the 3rd pillar, can notably allow you to benefit from different interest rates depending on the type of account you choose as well as the institution you decide to open it with. In fact, you can opt for a tied 3rd pillar 3A subscribed through a bank or insurance company, or a free 3rd pillar 3B available only through insurance. That's why it's a good idea to compare the 3rd pillar offered by the banks and insurance companies you're interested in, to make sure you're properly preparing for your retirement. These pension contracts differ in many respects. In addition, bear in mind that interest rates fluctuate very often during the year. To make a coherent 3rd pillar comparison and choose the best option, you should therefore take into account several criteria, including:

The length of time you wish to save on your 3rd pillar;
The desired level of risk
The size of your assets.

To remember

It's important to stress the fact that choosing a risky investment involves risk and may result in partial or total loss of capital.

3rd pillar: Advantages and disadvantages of the main companies

Institution	Advantages	Disadvantages
SwissLife	Low fees Surrender value from 1st year Significant product decline Large real estate portfolio, guaranteeing stability	Higher-than-average minimum contribution required on most products
PAX	Cooperative, so redistribution of part of the profits to policyholders Low fees since active management	No agencies and few contacts
AXA	Low fees Flexible products	Recent products, little hindsight Generalist insurer
VIAC	Fast underwriting Silmplified management mobile app Low fees Flexible products	No guarantee

How to compare 3rd pillar pension offers?

First of all, it seems pertinent to distinguish the elements that differentiate 3rd pillar 3A from 3rd pillar 3B. The first provident contract mentioned allows you to make payments throughout your working years in order to enjoy a peaceful and comfortable retirement when the time comes to recover the sum available on your third pillar. The second pillar, on the other hand, is more interesting if you want to save over a defined period and for a specific project, so you can withdraw the funds whenever you like. These are just a few tips to help you choose the type of Swiss 3rd pillar contract that best suits your needs.

Before committing yourself, also take the time to compare banks' and insurance companies' 3rd pillar on the following elements:

interest rate;
anticipated capital at the end of the 3rd pillar contract;
realizable tax savings;
different fees and management costs;
3rd pillar surrender value;
investment strategies;
any guarantees and benefits to which you may be entitled.

To remember

If you have in mind to use an online 3rd pillar comparator, bear in mind that it will be only an estimate given that interest rates vary quite frequently over the course of the year.

Advantages offered by the 3rd pillar 3A

It's possible for you to join this pension contract through a banking institution or an insurance company, leaving you more choice compared to the 3rd pillar 3B. On the other hand, interest rates are often very different depending on the institution, which seems to be a particularly important point to specify in the case of a 3rd pillar comparison in Switzerland.

A 3A retirement account also offers the following privileges:

you can open several 3rd pillar contracts, which allows you to diversify your investments financially;
the 3rd pillar can easily be customized and modified according to your objectives, your projects or even your investment horizon;
it's possible to transfer all the funds in your 3A 3rd pillar to another, which can allow you to take advantage of the more attractive interest rate offered at a different institution from your own, for example. However, it's important to specify that in this scenario, the money can only be moved to another 3rd pillar insurance and not to a classic savings account.

Subscribing to a 3rd pillar 3A also allows you to benefit from a not inconsiderable tax advantage since you can withdraw the sums paid into your 3rd pillar to reduce your taxes.

The 3rd pillar 3A on a savings account or a provident fund: the comparison

Finally, if you decide to opt for the 3rd pillar 3A rather than the 3rd pillar 3B, all that's left to do is comparing the provident contract opened at a bank with the one offered by an insurance company.

See also: How do I use my 3rd pillar?

The savings account is the name given to the investment of a bank 3rd pillar. Here, the remuneration offered is low since overall, bank interest rates in Switzerland stand at less than 1% at the moment. So, when your capital is recovered from the 3rd pillar, you'll get a tiny bit more than the amount you saved during your paying-in years. Nevertheless, where the 3rd pillar bank is interesting is that it allows you to enjoy great security. In fact, the interest rate for this retirement provision is guaranteed and will therefore remain the same from the beginning to the end of your contract. This means you can avoid the risk of losing money, and it's easier for you to know how much capital you'll get from your 3rd pillar when you retire.

The provident fund, meanwhile, corresponds to a 3rd pillar invested in insurance. This is the opposite of the savings account, since its income is higher, but it offers less security. Thus, the sum available on your pension fund can be spread over various financial products, such as equities or bonds. Admittedly, the rate of return is attractive, ranging on average from 3% to 7%. This means that you'll be able to recover more retirement capital than the total sum of your payments. However, be aware that the money invested in your 3rd pillar insurance will be exposed to the instability of the financial markets, which may therefore result in a loss of money...

As you will no doubt have understood, comparing the different retirement provision offers in Switzerland is not an easy task since many parameters need to be taken into account to make the best choice in terms of a third pillar. That's why it seems essential to get direct information from a bank or insurance company so that you can get a comparison on the 3rd pillar best suited to your situation.

3rd pillar : List of institutions

To remember

The 3rd pillar A, linked (or pillar 3A) is available through banking or insurance
The 3rd pillar B, free is available through insurance only
The results provided in an online comparison are often estimates of capital at term. It is not possible to forecast a capital since interest rates vary over the years.
It is possible to obtain attractive interest rates via a risky investment profile

Updated on: 13.02.2024Written by Joffrey MaitreHead of private provision department at Comparea

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