Financial downsides of early retirement

Also not to forget: if you are married and your wife still works, you can ride on her AHV-coattails :wink:

Yeah, I think that’s it. It’s probably technically correct but will get challenged and has no chance to fly through.

Well, maybe as a startup for a few years? I’d totally buy an app that can sort my black socks after the laundry :wink: .

Anyway, the bottom line seems to be that early retirement will incur a 0.2%-0.3% wealth tax up to age 65 and the trading the pension with (too) high conversion rate from pillar2 for a lump sum.

What is a bit scary right now is that there are a few changes to the social security system in the works and the “rules of the game” may change. This means we are well advised to plan around this and add a bit of additional margin to our computations.

Thank you for putting up with my stupid questions.

Based on the current maximum AHV pension of CHF 2450 per month, I assume. Which translates to a required average salary of CHF 88’200 over 44 years.

However at 65, when you want to claim the AHV pension, the average salary will be higher, because the maximum AHV pension has increased. In 15 years plus I expect it to be closer to 100’000. Impact of inflation.

Yes, based on 88k a few years ago I worked out I could earn a negative salary. As you say, the 88k number will increase with inflation, but since then, I also worked a few more years and wealth based AHV payments will also be a non-zero number.