I’m changing employers and currently have two SwissLife 2nd Pillar accounts. Do I have to transfer them both to my new employer’s scheme? I’d like to leave one of them somewhere like VIAC/FinPension if possible.
Welcome to the forum and it’s search function.
Yes, you have to transfer both of them to your new employer’s scheme up to that scheme‘s maximum limit (generally: yes, all of your benefits) and are not allowed to leave anything on a vested benefits account.
Has been discussed enough times:
Thanks, I did search but wasn’t successful. Practically what happens if I only move one of my accounts to my new employer? How would anyone know? Are there penalties?
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Practically: most likely nothing.
Theoretically; you go to jail (if you steadfastly refuse)
Practically can’t they refuse to honor some benefits? (Life or disability insurance)
It’s pretty standard for insurance contract to be void if people lie/fraud.
This post was flagged by the community and is temporarily hidden.
Had a good laugh on that one
This is the official collective jurisdiction under the current and even the previous pension legislation (covering nearly 50 years).
There are only two cases where pension funds sued to get the money someone received as vested benefits (Freizügigskeitsleistung) (FZ) and didn’t pay it in: Once because the person died shortly thereafter and they became liable to pay one-time benefits (which was confirmed, the FZ had to be paid-in retrospectively), and once because the person got a disability and requested disability payments from the pension fund (and funny enough the fund did not even get the FZ retrospectively, they just got told to reduce the invalidity pension accordingly).
In other words: No fund ever sued to get the money without having a very good reason for it.
The worst case is having a fund that routinely (and likely automatically) asks for the money multiple times, and you caving in late but eventually, as they then might ask for (currently) 2% interest on top.
There was an article in the newspaper (yes, a reputable one) in which a lawyer indeed stated that possibility - not as a penalty, since no penalty is defined in law, but merely to enforce your obligation to have it transfered. And yes, IIRC it also did mention penalty interest.
My post was flagged as inappropriate. I assume our community standard is that we shouldn’t ask nor answer questions like the above
Hard disagree. And who flags a post just because they disagree with the content? That should not be tolerated!
We’ve established that deliberately no transferring pension benefits to the new employer’s pension fund is (in almost all cases) against the law. Even though it’s not penalised outright. And that the obligation isn’t met happens all the time. You just need to look at the hundreds of thousands of vested benefits accounts and hundreds of millions of vested benefits accounts managed by Stiftung Auffangeinrichtung to confirm that,
That said: however often it happens, there is a fine line - or one may want to draw one between:
a) broadly and hypothetically discussing facts, risks, chances and consequences of doing sth. “illegal”
b) outrightly advising others (how) to do it. As at least one poster did above in a post that got flagged
Would be good if whoever adjudicated could clarify so we know… or otherwise explain that it happens automatically once x people complain.
I didn’t give any advice and didn’t say anything I wouldn’t be prepared to repeat to my employer
Hi, I flagged it, it seemed to me like a question best left for moderation than for me to start to discuss openly here since it would be more a matter of forum policy than of me being personally exposed.
I don’t think we should discuss breaking the law, including simpler matters as whether it is enforced or not, publicly on an open board. We’re currently below the radar but it could not last if we become too casual about it. Same as why there are some topics I’d discuss over the phone but wouldn’t send an email about.
Nothing against any poster in this thread (or any poster in general). Thanks for your understanding.
There was an article on this topic in the NZZ:
It’s paywalled, but I could access the article through this link: Pensionskasse: Der umstrittene Trick - Opera News
First-time poster, but long-time lurker as they say, especially of these conversations regarding the 2nd pillar, since I’ve been working as a pension actuary for quite a while here in Switzerland.
Essentially, just wanted to add something that I don’t believe had been explicitly mentioned before regarding the idea of “forgetting” one of your 2nd pillar accounts behind. That is, if you ever consider buying into the fund, i.e. purchasing missing years of service (leaving aside all considerations of the pros and cons of such a decision for now), there is usually a form to complete and sign in which you confirm that all your vested benefit accounts have been transferred to this current institution (ref. Art 4 al. 2bis LFLP). Now, given that such buy-ins usually lead to a tax return/refund, I would personally be a lot more concerned about lying on such a form than “forgetting” the initial transfer. Indeed, I’m not a tax expert, but I can imagine that the tax authorities wouldn’t be thrilled to find out that you’ve received a tax refund that you might not have been entitled too…
On a side note, as a wannabe philosopher in my spare time, I find the debate about “forgetting” to mention some of one’s vested benefit accounts quite fascinating as well. Indeed, it seems like a classic moral philosophy or ethical debate: would you do what’s “right” if no one was looking and you could never get caught? I think it’s the difference between Kant’s deontology (“right” is what reason dictates, no matter the consequences) and John Stuart Mill’s consequentialism for instance (“right” depends on the context, and most importantly on the consequences).
Anyway, just my (first) 2 cents!
I think there is a big difference between refusing to transfer the 2nd pillar to your new pension fund (basically no harm done to anyone) and getting a tax refund by making wrong statements.
Thanks for your response. I totally agree that there is a big difference in the potential consequences of each. But even though one might disagree with the law itself (i.e. demanding that one transfers all of their vested benefit accounts to their new institution), which is fair enough, technically-speaking though, there is still a violation of the law underlying both scenarios, right? Now what one decides to do in light of these two “different” ethical dilemmas is indeed an interesting moral philosophy discussion! (as hinted at above).
I don’t think anyone trying to take out as much as possible of their 2nd pillar funds because they think pension funds are too risky (they could use your money to pay other people’s rent), too restrictive or not profitable enough (equity allocation too low), conversion rates getting lower and lower etc. would then go and buy themselves back in, right? That would be counter intuitive.
I think it depends what we’re talking about.
There is a distinction between complying with the law and obeying the law.
When it’s about generally accepted principles such as not to harm others etc. I guess, most people would obey the law, because they think it’s the right thing to do.
However, when it’s about many things in life that are just imposed upon others for whatever reasons, that affect individual freedom or ones private autonomy, then most people just comply with the law, not because it is the law, but because the consequences of not doing so would have severe negative consequences (e.g. governments collect taxes at gunpoint if necessary).
There are philosophical views that say there is a moral obligation to pursue ones own self-interest and collectivism, altruism and similar principles are immoral, and in the light of that, it is also understandable that in the case of the 2nd pillar where one could argue that such a law violates ones individual freedom, private autonomy and self-interests, and the consequences of not complying with the law are basically inexistent, more and more people are investing 2nd pillar money in separate vested benefits accounts. I mean this is even often advertised in financial / economic magazines and news papers (or their podcasts) in Switzerland. It’s a grey zone, but a more or less accepted grey zone and there is obviously also a business model for it.
When you see it in the light as described above I don’t even think there is an ethical dilemma. And even if, if the policy makers wanted to prevent it, they could easily do so, but it’s not happening. Probably because many of them are using the loophole themselves?
You’re absolutely right. These two distinct behaviors would be incoherent indeed. I guess my original intention was to make people aware that this could become a bigger issue down the line if one ever considers a buy-in and has forgotten about their decision not to transfer some of their vested accounts initially. An unlikely scenario perhaps!
That being said, I do believe that there are certain circumstances where buy-ins can be advantageous, e.g. depending on your marginal tax rate, how long you plan on staying in Switzerland, where you might be going after, if you use your 2nd pillar as your bond allocation, etc. But that discussion probably belongs in another thread
I think I can appreciate the distinction you make between complying with the law and obeying with it. Technically-speaking though, I think a tribunal would expect you to obey with the law at all times (if I understood your distinction right). Different philosophical views are certainly interesting and worth discussing, especially as a new law is being developed and debated, but ultimately, once a law is enacted, I don’t think it is expected that the citizens would only apply it if their moral views agree with it. I feel this is the essence of the debate here about “forgetting” your vested accounts behind and why I called it an “ethical” dilemma: people seemingly allowing themselves to wonder whether they should follow the law as it currently stands or not.
I was not aware of that, thanks for pointing that out. Is that truly the case? If so that would definitely make this part of the law fairly grey or soft. If you can retrieve any such references, that would be great. Then it’s an option I might consider myself later on then Cheers.