@Alex, you are correct. There was a lot of frivolous expenses. This brings me to a small update:
1) Expenses review
After cutting a lot of expenses already, I looked for other ways to reduce the remaining ones. The biggest win in this category was lunches during the week. I like to cook but am quite lazy when it comes to cooking for myself. I forced myself to do so and this marks the first week in which I haven’t had to go out for lunch at work nor buy pre-cooked meals. This (used to) mean CHF 15-30.-/day.
Actually, by using what I already had stored in my kitchen and only buying what I needed, this week’s groceries amount to… CHF 30. I know it won’t always be like this once the cupboards are a bit more empty, this is what I would normally pay for 1 to 2 meals tops, and I have used this for 21 meals this week. Being vegetarian helps of course, and having a good stock of legumes, rice and pasta has helped a lot.
2) Budgetting
I know, I know, YNAB. I thought this was bulls****. It was not. Long story short: living paycheck to paycheck, I always had this small bit of anxiety in the back of my mind about being able to pay all my bills on time and of not knowing exactly where I was standing. I don’t have this anxiety anymore. I now have a clear idea of where I stand and where I will be standing in the coming months. It’s liberating.
This also contributed to make me realize where I could easily cut other expenses (cf. point 1).
3) Pillar 2 optimization
I’m in a position where I can actually move the Pillar 2 pension at the companies for whom I work. I am therefore actively looking into a better pension plan than the one we have that has (always) been giving only the minimum interests to their members, so 1% since 2017. This will of course benefit me, but also all the employees, which is a nice bonus.
I wish there was an equivalent to VIAC for Pillar 2! The clostest I have found that gives acceptable, or at least higher than minimal, returns is “Fondation BCV 2ème Pillier”. Last year, their interest for members was 2.75%, while their result on the market was 7.68%. The difference between paid interests and their result seems to have gone into coverage reserves and management fees. This seems to be somewhat on par with what I have seen so far.
If any of you have recommendations for a good Pillar 2 pension plan, I’m all ears!
4) Vested Pillar 2 transfer
As the current Pension plan I’m affiliated with is so bad, and as I had a lot of “surobligatory” saving, I had (without my understanding at the time) a good chunk of my previous Pillar 2 put into a Pillar 2 Vested Benefits Account at the same pension, giving… no interest at all. I discovered this while looking into every aspect of my finances.
Yesterday, I have sent them the required paperwork to transfer this sum to a Postfinance Vested benefits account that I plan to put in their PostFinance Pension 45 fund (which is the maximum they’ll allow for Pillar 2, otherwise I would have gone with Pension 75).
Normally, you can’t transfer such accounts unless some specific conditions are met, most notably changing job or early withdrawal, but there is an exception to the law that allows you to move your vested benefits pillar 2 to another institution/pension/bank if you so desire and IF and only IF you don’t have a lack of coverage in your Pillar 2.
It’s not giving amazing returns (well, actually not at all this year so far), but will still be a lot better than 0% or even 1% in the long run. Furthermore, the big advantage is that this account counts toward the required assets under management to qualify for a free account. This way, I won’t have to keep CHF 7’500 laying around in a 0% account nor have to settle for their crappy funds with money I could otherwise invest elsewhere. Between this and the “emergency fund”, I will even reach the CHF 25’000 needed for the “Private Plus” account offering free worldwide ATM withdrawal, so why not.
If you have vested Pillar 2 accounts from previous jobs laying around, have a look at your options, it could be interesting to move them somewhere else. If you have lost track of those accounts, the 2nd Pillar Central Office can help you track them down.
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So there you have it. I have been busy reviewing everything I could about my finances. It’s a thrilling process, actually, as there is so much to learn. I’m banging my head on the wall seeing how clueless I was and actually how easy it would have been to learn it all 10 years ago.