At the beginning of every year your mailbox becomes crowded with statements of all kinds: tax statements, bank statements, and donation receipts to name just a few. Many employees also receive the insurance certificate from their pension fund, which frequently ends up unopened in the filing cabinet or even in the bin. What they don't realize is just how important this certificate is for their future.
If you are lucky enough to have a company pension, be smarter! Apart from giving you information about your insured benefits in the event of death or disability, your certificate contains essential information on how much disposable income you will have after you retire. So take a few minutes to understand your current pension situation.
The AHV/AVS Statement
In comparison to the standard state retirement provision "Old Age and Survivors' Insurance/Disability Insurance", which forms the "first pillar" of the Swiss retirement system, company pension funds are very diverse. Today there are some 2,500 pension funds that vary greatly in terms of size, management, legal form, and benefits. If you don't have an occupational pension scheme or receive monthly salary statements, you can order an AHV/AVS statement from your individual AHV/AVS account or a pension forecast from the AHV/AVS compensation fund: www.ahv-iv.info
Information on benefits under the first pillar comprises:
- the maximum single person's pension with full contribution period;
- the maximum married couple's pension with full contribution period;
- any contribution gaps, because the AHV/AVS retirement pension depends on the contribution years and the salary level.
For men, the maximum or full period for having paid contributions is 44 years. For women, it is 43 years. Contribution years are classed as periods during which:
- contributions have been paid;
- the gainfully employed spouse has paid at least twice the minimum contribution;
- parenting credits or credits for time spent caring for relatives can be awarded.
The Second Pillar Certificate
For many people in Switzerland, second pillar pension funds are rightly the most important part of their retirement provision. This is because the contributions paid by employers and employees accumulate. After a few decades, a large portion, if not the largest, of personal assets has been saved in these pension plans.
Your annual pension certificate, which you will receive from your employer's chosen fund, provides you with all the necessary information including your AHV/IV / AVS/AI status and any gaps.
Your Third Pillar Statement
Finally, a third pillar of retirement provision is available in the form of an annual tax-deductible saving allowance that can be paid into a special third pillar account. You can still choose to invest your third pillar savings, and the bank that manages your account will update you accordingly on its status.
What You See And What You Get
All in all, it's no surprise that there is no standard pension fund insurance certificate. Rather, there are dozens of different types. Some contain just a few basic pieces of information, while others are very detailed. In any case, it's important to look at the information more closely and to gather all statements covering all three pillars (AHV/IV / AVS/AI, your company pension and any third pillar savings) plus any of your other assets. Otherwise you won't have a complete picture of your retirement provision. You should also bear in mind that the projected assets are based on your current savings. So depending on your current age and future pay rises, your pension might actually turn out to be higher than you thought.
To understand the essence of a typical Swiss pension fund insurance certificate take a look at the six main parts of this certificate for a Swiss national who has no gaps in coverage.
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