Facts and figures, guys, facts and figures.
Let’s not start yet another political brawl.
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Apart from the overall complexity of the “solutions” proposed in the 2nd pillar revision, as I young person (<30) I don’t really like the following points:
-
reducing the mandatory 2nd pillar contributions for the older workers (from 18% to 14%) and increasing them for the young workers (from 7% to 9%).
This basically will reduce the income after deductions by 2% (gross) for young people, and increase it for old people by 4%!
So they force the young to pay more in it, when we know it’s “d̶e̶a̶d̶” money that won’t compound much and that other revisions will be needed, lowering even more the benefits. Also, people close to retirement will pay less into it (
). -
supplemental income for the people reaching retirement in the next 15 years after the revision: max 200 CHF per month also depending on the 2nd pillar size.
I agree, these people will be a bit screwed, but who won’t? I am screwed being now in my mid 20s when they will lower the conversion rate again in 10-20 years. With this “supplemental income” they will take from everyone to pay these 200/150/100 per month.
Final remark: IMO if you decide now to lower the conversion rate to 6.0% you do it for everyone, because the system was not well designed apparently. This last idea clashes with the concept that and acquired right (pension) can’t be taken away from you.
I feel a reform is needed ASAP, but this might not be the optimal one. Is it worth to wait? Or you should bite the bullet and take it as it is?
Sorry for the rant and feel free to disagree 
!
PS: in the end I can’t even vote, so I need to relax and avoid thinking about it as it’s outside of my control.
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Regarding your first point, I think the goal is mostly to make employing seniors more attractive rather than shift who is paying. For the same effective salary, a senior worker is a lot more expensive for the company, and I believe it’s often cited as one of the main reasons they struggle to find work.
I guess the contributions for the < 35 were increased to both reduce the spread and somewhat compensate for the reduced contributions further in life, although in the vast majority of cases it will most likely result in a quite a bit lower total pension.
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My understanding is that the motivation is that people > 50 tend to have a lot harder time to stay in the workforce. While this might not be the only issue, at least cost is one of them, if a young employee costs you less, you might prefer hiring them instead of more expensive older workers.
Keeping people employed is good for the pension fund since they continue contributing.
Edit: Personally I don’t even understand what the benefit is to do age discrimination on the contributions (my employer uses the same %age for everyone, but they can do that because they contribute more than the minimum on the mandatory part)
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Nice thought!
The reality though is it has happened before, the rate used to be 7.2%. In addition, with respect to the above-mandatory part, pension funds have been at it for many years.
And let’s not even talk about the sleight-of-hand switch from defined-benefits to defined-contributions.
Why can’t they just be paid less then (i.e. making it a lower “gross salary” but the same when pension contributions are taken into account)? Would that somehow violate some discrimination laws?
No legal requirement that I know of but it’s just the way we’ve always done things: salaries go up with age/experience but they don’t go down (unless switching position/company/industry).
Edit: The swiss people I’ve met tend to think mostly in terms of gross salary when discussing increase/decrease and net when it hits the bank; so they don’t factor in the employer’s 2nd pillar contribution (and other contributions from which we get a benefit): a lower gross salary would be perceived negatively, even though it could result in an equal level salary when factoring in the employer’s 2nd pillar contributions (which would roughly make the cost of the employee stable with social contributions taken into account).
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I understand your concerns, but I think you should try to think about the overall society and not young vs old. In the end old people were once younger and they contributed to make CH what it is today.
In general the pension reforms tend to happen because of increasing mortality age and the only way to do that is
- take more money from younger people who have more time to make up for the loss
- reduce payouts for pensioners choosing annual pension vs lumpsum
- Keep people employed for longer periods
- Let pension funds be more aggressive in their investments
- Combination of above
Any solution would always have a group of people who would be more impacted than others. Unfortunately there is generally no “great” for everyone plan.
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I don’t, he’s basically a child with no life experience. “Dead money”, that’s just disgusting.
- Make sure that increases in productivity benefit society as a whole and counterbalance the need for more worktime to get same quality level retirement?
Some jobs are bound to disappear, not everybody will be able to work more to earn more (on the other hand, some jobs are in high demand, that can’t be performed by everybody but could benefit from better information and incentives from the private and potentially public sectors).
I think “dead” money was referred to investment in 2a which is earning very low return. Of course depends on pension funds but some might only give 1%
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I read it as “dropping money on dead-to-be”.
I also understood it differently, in that he has money taken away that he’ll possibly might not even get back in full, let alone with any meaningful returns.
Due to compound interests, it would make sense to save early for retirement. Many people are not saving by themselves or even in 3rd pillar accounts. Those people add risk that the society will have to step in to take care of them.
Increasing contributions for young people would thus make sense, but the problem is the meagre returns of most 2nd pillar providers and the uncertainty of the future conversion rate or the possibility to take the lump sum.
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Indeed.
I’m going to edit my post, even if I feel it was clear I was referring to the money being “dead” because of the low interest.
And I let the adults with real life experiences discuss where my money should go 
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Honestly, one reason why keeping some anonymity (including age) is (unfortunately) still necessary to have a rational discussion.
I take it as another reminder that we should try to argue with facts and avoid judging someones answers based on whether they are 15, 50 or 90 years old. 
That being said, it looks like the polling is not as much in disfavor of the reform in the poll from SRF as it looked like in the previous polls. A ‘No’ is still more likely, but not all hope is gone.
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Age is in and of itself a fact. A person aged 15 has different experiences, needs, wants, expectations and aspirations than someone aged 50, and someone aged 90. Democracy recognises that this can’t be up for discussion, so equal weight is given to every vote. Someone aged 15 or 90 can very easily say “yeah screw that, yolo” exactly because the teenager knows they have all life before them, and the nonagenarian knows they have most life behind them, so nothing much matters. A 50 year old though know they have a finite but not small time left, so their decisions will be weighed accordingly.
The reason arbitrary ages are used to decide adult rights and responsibilities is because biology deems us adults from the age of 12-13 or so, but societies correctly understood that someone aged 12 lacks life experience, and is still very much forming their character.
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Another big transition is after having kids. I’d actually think having only those who have raised kids for a few years vote… but that’s probably going to start another flamewar
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Absolutely. I think you’re trolling with the second sentence, but fully agree with the first. My kids definitely changed ME.
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I still advocate better returns. This is the only way to improve everyone’s outcome without penalizing anyone.
Pension funds, get your acts together!!!
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