Be careful with these assumptions. Do you intend to work until 58? (earliest retirement age). If not, you will not be eligible for pension annuities because you will leave your employer and therefore will have to transfer your pension capital on a (better 2) Freizügigkeitsstiftung.
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Yeah, good point @pwi – my worst case scenario is modeled with no further employment and having to park my pillar 2 money at a Freizügigkeitsstiftung, which I model with a return of 0.1% (see also my “forward assumptions” return section). Some are even at 0% these days. The only good news is that you can park your pillar 2 money into two different accounts at Freikügigkeitsstiftungen (to optimize for lower bracket tax at two different payout years).
I would hope to invest in a better vehicle than at a Freizügigkeitsstiftung, but this is what I base my worst case return scenario on for my pillar 2 savings.
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Wow congrats mate!
I guess we need to have a lunch together this week or the following one to discuss “your next life” 
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Would you like to share more details about these?
Quick update if anyone is interested, plus a potential pillar 2 tip:
TL;DR: Pulled the trigger, feels like my best decision in at least a decade.
In more detail:
Pulled the trigger last year, a quarter or two later than I had originally planned, mainly thanks to tactical timing advice from a colleague and thanks to COVID-19. Thanks also for additional vesting stock options. Early retirement felt awesome from day 1.
Original plan was to enjoy life without work for a year or two before looking for enjoyable part-time work. I even successfully fenced off all the headhunting sharks who circle you even closer once they see that you left Hoolie. Siren-style they throw number-wise tempting offers at you, but you know it would be just more of the same, and you’d work for, say, Foolie, instead of Hoolie … or for some hip but actually unremarkable and overhyped FinTech startup with basically zero prospect of ever being cash flow positive (except for maybe getting acquired some day by a cash flow positive but dumb incumbent). Anyway, I digress.
About a month after I left I came across this interesting part-time job ad somewhere between IT and finance (professional asset management mainly for institutional investors) in a very small company (< 20 folks). Sat on the job ad for a month, applied after all, and - you guessed it - was hired a couple days later. As a former product SVP at Hoolie expressed it to me maybe a dozen years ago or so: “Don’t leave, but if you do, that Hoolie stamp on your butt will really help you find a new job!.”*
What’s changed since my original post?
- Family: I’m committing a lot more time to family and myself. Everyone seems happier. I could stop here, the remaining changes are minuscule in comparison.
- Perspective: I’m developing a selective attitude towards normal work-space interactions and tensions. I tend to ignore those who seem to have a potential negative emotional impact on me, I relish those that feed me positively. Previously, I would have spent lots of personal energy on addressing the negative ones … at the expense of my personal well-being.
- Risk tolerance: this one’s a bit surprising for myself, but I’ve substituted about a 3rd of my portfolio (prior to and independent of my new job) from US index market investments to handpicked and actively managed (by myself) dividend growth, dividend and value investments, mainly over the course of the past year or so.
I’m slightly panicking about how well these investments have faired so far (when taking into consideration the recent rotation from growth) as I was a true believer in index investments and dollar cost averaging (or the IMO better variant of value averaging). - Perpective II (please take this with a grain of salt): instead of looking at my meagre low 7 digit portfolio, I now sit at the engine of multi-billion dollar investment portfolios - I would have never guessed how much easier it is to manage your own money versus other people’s money.
BTW, all of these changes could have theoretically been implemented without FIRE, but me personally, I would not have been able to, psychologically.
Anything else? Ah yes, one of the teasers, the potential pillar 2 tip. I’m afraid I’m almost sure it’s been mentioned numerous times elsewhere on this forum already. But if not …
Hypothetically speaking, if your goal was to stop working, and possibly pick up work again at some later point in time, but you wanted to manage part of your existing pillar 2 money in a Freizügigkeitsstiftung account, even after you picked up a new job? Of course, that’s against the law, so you can’t really do this. But suppose someone did want to proceed anyways …
What I think they would do is split their pillar 2 amount at their current/formal employer into 2 buckets into two different Freizügigkeitsstiftungen. Maybe half half, maybe 1/3 and 2/3, whatever their preferences may be.
Then, upon taking up their new job, they would transfer one of their FZ accounts to their new employer. They would unintentionally forget about transferring the other FZ account.
Coincidentally, I’ve even heard from new employers that at this time, they’re not even interested in “new money” piling into their accounts from a current risk return perspective under current regulations.
So, that concludes today’s quick update. Sorry if it was a bit long.
* Any current day exec at Hoolie would not speak in such words and the message per se would not be approved by internal PR, but back in the day some people would speak openly, sometimes for the good, as this SVP, sometimes for the bad, as many other SVPs, including the inventor of one popular mobile OS, or the first Swiss at Hoolie.
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Hey thank you for sharing your story and tips.
Maybe money gave you more confidence for your own good.
I was intrigued by the low return of your pillar 3a. I read 0.3%. In which company is it invested? Is it invested in ETFs?
Happy to read more on your new professional chapter.
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The 0.3% is just my conservative assumption, though in reality the returns recently have been close to that. I initially started saving for 3a with my bank and never bothered to move it to something ETF backed (which I probably should have done).
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Hi, since I am similar age and just a few years behind you (i.e. pulling the trigger soonish), I have a question which was triggered elsewhere on the forum, but I find belongs here more than in the stockpicking or net worth threads.
I am starting to plan where to put my Pillar 2 (PK) once I leave my last employer, which I will split into two. It makes up about 20-25% of my NW. Pillar 3, 5-10% of my NW.
You have similar shares of NW locked up in retirement accounts (2nd pillar, “forgotten” Freizügigkeitskonto, 3a accounts), which you also calculate very low returns for.
Are you keeping these funds in Freizügigkeitskontos and not Freizügigkeitsdepots, 3a Vorsorgekontos and not 3a Vorsorgedepots as part of your desired “Bond” allocation? Or other reasons?
I plan a relative aggressive >80% stock allocation overall, and due to the longish blocked holding time of my Freizügigkeitsmoneys (till 65), will probably go ~100% stocks, via Finpension, VIAC & Frankly products, on PK. 3a already is 99% stock.
What could go wrong? 
No, I’m joking, that’s not my question, but what is your reason(s), if you still do, for keeping your PK and 3a in relatively low return accounts? Depots not safe enough? Providers for such products questionable for such amounts? ETF products at Finpension etc. not what you want and so this part of your NW becomes bond allocation?
Thank you.
PS would also love an update on your general journey post FI(RE), last one is almost a year ago, I have appreciated the insights given so far.
Good on you! Good preparation for pulling the trigger provides ease of mind, at least to me.
Happy to potentially help.
The very simple and embarrassing reason is me not knowing or using the terms correctly.
My, ahem, “forgotten” pillar 2 is in a Freizügigkeitsdepot (didn’t know the term exists, always referred to it as Freizügigkeitskonto).
In fact, I believe all - well, almost all, see my further comments below - Freizügigkeitskontos are actually Freizügigkeitsdepots for the simple reason that you wouldn’t want to hold cash there in case the company holding the money goes bunkrupt and you’re left without funds or maybe* up to the “Einlegerschutz” insured limit of the of CHF 100k.
My 3a is actually in Vorsorgekontos and not Vorsorgedepots and I look at it as a “bond” allocation.
On a tangent, looking at performance:
Pillar 2 in the “forgotten” Freizügigkeitsdepot actually did worst in 2022 of all my assets because it basically invests in ETFs that more or less track the market. Minus 10% or so for the portfolio of ETFs held there. The low returns I anticipated when planning was much much lower in practice.
Pillar 2 at my new part time employment will get the minimum interest mandated, so probably 1% up?
Pillar 3a is obviously flat for 2022 (ignoring inflation) since it’s in Vorsorgekontos which somewhat unexpectedly did much better than bonds last year. Yay. (Side note: as the market timer that I obviously won’t ever be I’m actually considering moving the 3a Kontos to Depots just around now’ish, believing the market will bottom sometime this year or already has last year, but being a risk averse chicken I am not sure I will.**) 
Of course, with the about ten year horizon until I plan to cash out of the Depots and Kontos, I expect performance to look slightly different then. We’ll see. 
* If your Freizügigkeitsstiftung is a bank or an asset manager. I hope they all are?
** I’m basically going by The First Commandment in Jason Zweig’s The Little Book of Safe Money: How to Conquer Killer Markets, Con Artists, and Yourself: “Thou shalt take no risk that thou needst not take.”
My expected returns from the assets available at retirement age (or a little earlier) will be just fine even if 3a stays in Kontos instead of Depots. I don’t need to take additional risk.
I believe I explained my Depot vs Konto choices above. Really only my fault of not knowing or using the right terms. If you still have questions, fire away.
Regarding the blocked holding time: I don’t believe you’re blocked until 65.
For pillar 3a you can cash out 5 years before and after turning 65. Assuming you have spread the money into several 3a buckets (you should) you also want to spread cashing out over several years for tax reasons (progression on Kapitalbezug per year).
For pillar 2 (employed) I believe cashing out depends on the Pensionskasse. Some are flexible, some aren’t.
For pillar 2 in Freizügigkeitsdepot/konto you can in principle choose the year receiving it between age 60 to 70. Not sure about the nitty gritty details in case you are still employed somewhere and “forgot” about the Freizügigkeitsdepot/konto you want to cash out. Probably best to be not employed in the tax year you cash out the Freizügigkeitsmoney for tax reasons both because you want to avoid the tax progression and because you don’t want to stick it to the tax authorities that you both stopped working and had a Freizügigkeitskonto/depot as well as a regular pillar 2 payout.
Going back to the promised follow-up on “Einlegerschutz” and maybe more practically on parking money with Finpension and VIAC:
As for VIAC as a Freizügigkeitsdepot: if you choose a “bond” amount exceeding 100k, be aware that at least until 2020, they would not hold actual bonds but instead deposit pure cash at their partner/parent company (?) WIR bank. If WIR bank went bankrupt, you’d sit at worst on the CHF 100k “Einlegerschutz” instead of owning bonds in your name.
IMO really wreckless by VIAC. And they only informed me about this after I explicitly asked them how the “bond” portion of my deposit with them was held and why it was labelled as “liquidity”:
“Der Cashanteil deiner Vorsorgestrategie liegt bei der WIR Bank und geniesst dort ein Konkursprivileg bis CHF 100’000 (wird also privilegiert behandelt im Konkursfall in der Klasse 2 direkt nach Mitarbeiterlöhnen).”
To be fair, they wanted to optimize around negative CHF bond returns at the time, but it’s IMO still unaccpetable of them to do so silently, loading me up with counterparty risk for seemingly slightly better returns.
Finpension holds your bond allocation with actual bonds. You’ll own those even if Finpension (or Credit Suisse, their preferred ETF provider) goes belly up.
Sure. Stay tuned.
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can someone please explain the difference to naive me?
Simplest: Depot, things you actually own. Konto, things the bank owns that you think you own and that you have a right to own. Probably.
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While the standard VIAC strategies (<100% stock) indeed hold cash and not bonds, the fact sheets are correct and, to my knowledge, they don’t claim anywhere that there is a bond portion.
In an email, they mentioned to me that they will add bonds to their standard strategies now that they have become more attractive. I don’t know when this will happen, though.
Also, you can define your own strategy at VIAC, which may include bond index funds (the selection is somewhat limited, though).
As per VIAC’s message, CHF 100k are privileged in the case of a bankruptcy of the WIR bank. However, the esisuisse “Einlagensicherung” does not apply to pillars 2 or 3a.
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It doesn’t apply to pillar 2 and 3a funds held in Kontos.
Funds held in Depots are held in your name and are in your possession and therefore aren’t affected by the bankruptcy of the depository (of course there will be some bureaucracy and time passing before you’ll get your funds back, but you’ll get them back).
That’s interesting one.
Would you say that this is possible only after loosing career aspirations and/or after FIRE?
Myself, being non-managerial SME (big claim) in finance IT, in traditional corp, in matured department, I find very little motivation to push career just not to get involved in political grinder.
On the order hand, I feel becoming this “don’t touch what would stick to you” guy, which I would heavily criticize in the past of not being “get things done” guy.
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What’s an SME?
(20 chars)
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Subject Matter Expert
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I feel it’s mostly FI allowing me to take this stance.
And perhaps the a bit regrettable acceptance that a “get things done” attitude benefits most (1) my superior(s), (2) the company I work for, and, perhaps, (3) me. In that order.
Your_Full_Name’s Law of Merit at a Big Company. And maybe even at some smaller companies.
From a personal POV I historically definitely veered into the “get things done” camp. This was especially so at the beginning of my time at the GOOG. It’s just the way I’m wired.
For many years I didn’t want to believe that Google had slowly turned from a meritocracy (you benefit from you things getting done) into following the Law of Merit at a Big Company. Lots of personal time and well-being wasted.
I’m not doing this anymore despite my personality because I can afford it.
I can’t really speak to the angle of losing career aspirations (aside from being able to not have them because of FI).
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Quick update if anyone beside @rolandinho is interested:
TL;DR: Still FI, working part-time, currently evaluating further continued employment by my current employer, considering going full private.
For those reading along but haven’t followed the thread: I am FI, currently working part time at an asset management company, partially for learning how the professionals do this, partially for initially being uncertain about whether my investments will cover our expenses.
What’s changed since my previous update (March '21)? Using the same categories as last time …
- Family: I am able to commit more time as needed to look after things. I am glad I am able to commit the time, as my son is coming of age, which comes with its own challenges that I didn’t expect to be so difficult for me to handle. Not so much my son’s fault, more the way I am capable of dealing with it. Definitely glad I have the time.
I believe at my old job at Hoolie I would have either not picked up on these things at all because of too much committment to Hoolie or - more likely, as I did cut back on mental committment in the trailing year or two - would have picked up on it, but would not have recognized it in time as an issue I need to dedicate personal time to to help address.
On a more positive note we as a family in 2022 spent precious time together on awesome vacations, including a two week trip to Africa. - Perspective: probably even more hard-line on this one. Developed only very little tolerance for negative work-space interactions, expressing myself accordingly, and my environment is even adapting to my expectations.
I am still asking myself regularly whether I still want to experience the remaining marginal corporate drama that occasionally occurs. Will probably answer this question this year. - Risk tolerance: I am a little afraid of my beating the S&P 500 by over 20% in 2022 with my stockpicking portfolio will make me overconfident. Recency bias, pure luck, whatever. Anyhow, I would like to move more funds from more conservative allocations (globally diversified equity and bond ETFs) into my stock picking portfolio. Will have to see how this plays out. It’s a nice challenge to have to deal with.
- Perspective II++: managing your own money is so much easier than having to manage OPM (Other People’s Money). My Portfolio Manager colleagues at my current gig all ended up negative for 2022, some even trailing their benchmark (usually some index). Not being bound by such constraints as an individual investor I feel I can easily navigate current market inefficiencies and generate alpha. Famous last words …
Additional thoughs:
- pursuing a dividend (growth) strategy has definitely given me ease of mind: income though (growing) dividends financing lifestyle trickles in and is growing, and I don’t have to think about selling stock, especially when markets are depressed.
This concludes today’s updates. If you have follow-up questions, please fire away.
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You make me want to pick up stock picking again too. I’ve watched some FastGraphs videos and it seems that tool really makes it rather easy to find those dividend grower stocks.
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