Buy, hold, sell 2nd pillar

Hi everyone ! :slight_smile:

Is there something that prevent from, every 3 weeks, buying cotisations for the 2nd pillar (for instance until the 105% for early retiring) which are deductible from the income (25-35% for instance), then waiting 3 years latter and picking up the capital (5% tax at NE for instance), Then rebuying deductible cotisation and picking up again the capital wich is less taxed, etc. etc. ? :slight_smile:

It seems to be a trick and law may prevent people from doingt that, right ?

Err… not sure I understand what you are trying to pull out.

First limitation: “picking up the capital” requires either (additional provisions apply after the age of 50):

  1. Retirement when the minimum age allowing for it is reached.
  2. Own homeownership (only for your own home, can be used to repay the mortgage).
  3. Financing an independent business venture.

The situations where you could simultaneously input voluntary cotisations and withdraw from the 2nd pillar are very few and the tax office would pick up on any recurring scheme pretty easily.

Second limitation: you cannot deduct additional voluntary contributions until you have reimbursed the previous ones.

Third limitation: minimum amounts apply for voluntary contributions (not a very big limitation but maybe not “buying in every 3 weeks grade material”).

The tax offices are not dumb and they have much leeway in deciding what they consider tax evasion and take appropriate measures against it. I wouldn’t try it.

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You’re totally right and I thank you for the full answer
The key is indeed the three mentionned conditions :slight_smile:

Just another reflexion : so may we imagine repaying every three week a part of a mortgage, reimbursing, then buy 2d pillar another deductible cotisations, then 3 years after rapaying another part of the same mortage, etc. ?
Or do we have to repay the full mortgage

I precise that I do not want to risk myself trying it, I am just questionning this morming about the 2nd pillar and this question came into my mind :slight_smile:

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Two things:

  1. If you withdraw part/all of your second pillar to reimburse a mortgage, any subsequent contribution to your 2nd pillar would not allow for tax deductions until the full amount withdrawn has been paid back into the 2nd pillar. The taxes incured at the withdrawal of the 2nd pillar are reimbursed upon repayment into the 2nd pillar.

  2. The way you present it looks to me like trying to dodge (in another word, evade) taxes that would otherwise be due. I’m not a tax office and don’t have to make that call but your whole thought process sounds to me more like tax evasion than tax optimisation. Playing within the rules of the system with a focus on maximizing gains is accepted. Gaming the system is very frowned upon. I would not pursue these kinds of thoughts further.


A similar process may be doable with pillar 3A.

AFAIK it is possible to withdraw money from a 3A account once every 5 years to amortize the mortgage on your main residence. In this way, you can contribute 5 times to 3A (and get the 5 tax benefits at your marginal tax rate), and then get taxed once on the withdrawal at the more favorable tax rate (variable with canton and individual situation).

Obviously, cross-check and verify :wink:


Thank for your thoughs and you complete answer,
Once again, please do not pretend I have bad intentions,
Few hours ago, I didn’t know how 2nd pillard really works (except the fact that we contribute monthly on it). I may quote : "Look closely at the one who “cries foul” the loudest… So if you want to call it, it may rather be an optimization question than evasion. It was just a question. Few hours ago, I didn’t know that we could make subsequent contribution :sweat_smile: And I do not doubt the system has rules to prevent from your well-named “players” :slight_smile:

I understand better the 3rd than the 2nd pillar, and, IMO, don’t we lose money be withdrawing every 5 years on the 3rd pillar ? Indeed the insurance thing make our capital lower than the contribution, right ?

Why would you have an insurance 3a? That’s usually a pretty bad idea.


As a matter of fact, your pension fund won’t do it “every three weeks”.

The general idea is true: You can make voluntary contributions to pillar in 2 in high-income/high-tax years and withdraw for home owner-ship in lower-income/lower-tax years, thereby shifting taxable income between these periods and saving some taxes in the process.

But I doubt it’s really scalable into a recurring scheme.

I may have based my answers on some assumptions. I’d say if you are just starting to dive deeper into pillar 2, it’d be better to try to learn more broadly about what can be done with it before considering specific implementations. A few searches on the forum may land some useful bits of considerations in regard to contributions, buy-backs, pledging vs withdrawing, withdrawal upon going abroad, vested benefits and 1e. Pretty insightful reads.

We probably need a Wiki topic on the Pillar 2. Best non-wiki topic I’ve found is this one: What about Second Pillar?

Compiling what we currently have would require quite some time and energy, I’m not really up to it right now. Maybe somebody else would like to tackle it (possibly for their own blog, the task, if handled comprehensively, is big enough to warrant some reward :wink: ).

As for pillar 3a, we do have a Wiki topic for it: The Pillar 3a Tutorial
Feel free to point out any discrepancy, outdated or lacking information.


You’re correct, but as indicated by nabalzhbf and the wiki cited by Wolverine, linking 3A with an insurance is not the recommended approach in this community, exactly because of this « evaporation of your money in the first years ».
Instead, open an account and a portfolio of funds with an investment style that fits your personality and goals. For very long term, the highest fraction of stocks is expected to provide the highest return. But if you intend to withdraw the funds after 5-6 years, then a lower variability may be preferable.


Yes I understand why…
The argument of the man who sold me that was :
“with this 3rd pillar, you’re covered, your family too in case of unfortunate death, and your capital is guaranted for your retirement, moreover you got a fix 1.5% interest”.
Is point is that investing on stocks with a non insurance 3rd pilar, do not guarantee a capital for retirement…

“And if you want, you can keep your bonus-extra-money for investing on stocks, ETF on your own”.
That’s what I do. Is point is to invest on stocks with money I do “not need”

You’re right, indeed :slight_smile:

Thank you for the complements and the link ! :slight_smile: i just recently discovered the forum !

See my answer to “nabalzbhf” :slight_smile:
In addition to that, now that I already got this contract, I may use each increase in deductible amount to invest on stocks via 3rd pilar ? (VIAC, Finpension, etc.) but is is not a lot (300/y for the moment)…

Most likely the best way forward is closing that ASAP and take the loss (the sooner the smaller).
Just search this forum for “3rd pillar life insurance”.

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Yes, I am ok with you
But what is the aswer to people saying “contrary to a VIAC/Finpension 3rd pilar, yours with insurance is a WARRANTED capital for your retirement, an interest not so bad compared to banks 1.5% which make no loss of money on the long term, a security for your familiy and in case of invalidity ; and you can take the risk with your other extra money on stocks on Interactive Brokers” ?

How much is the insurance costing you? Eg compared to a standalone product. What are the fees on the 1.5%? (Somehow I’m not even convinced the 1.5% is guaranteed either).

(Probably this discussion should be forked to a new thread)

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