Introduction + Anything Missing for RE?


I’m new to this forum, but have been planning for FIRE for a while. Now it looks like the point in time is coming closer, but I’m worried I’m overlooking something obvious in my planning. And the error bars for planning are just soooo large. (Or maybe that’s just me…)

This is where you all come in: is there anything missing in my plans? For example, I only learned about the AHV contributions (on wealth when neither of a married couple works) a few years back, and had to adjust my projections a bit based on that. Any other things like this that may be easy to overlook would be interesting.

For background, I’ll give some rough numbers here. (Sorry, I don’t feel comfortable sharing full details on wealth or income/expenses, but I admire others who do and I see interesting discussions coming from that!)

I’m married, with a child in their teenage years. We’re around 50 years old and we moved to Switzerland when we were in our thirties, so we are missing some early AHV contribution years. (I find the AHV calculations very complex, so that I still don’t trust my estimates of what we’ll really be able to rely on after age 65 from AHV.)

We live in the canton of ZH and own our apartment, so we don’t have to pay rent, but of course there’s upkeep, for which I estimate about 1% of the value per year.

My partner wants to continue working for a few more years and is actually enjoying the job, while I’m feeling more and more stressed lately and think my quality of life would be improved with RE. (That’s hard to say, though, and with a teenage kid I won’t be just spending my time traveling, but maybe the question of what to do with one’s time is something for another post. And I’ve seen a few good discussions of this already here at MP.)

We’re following a pretty conservative investment, “classical” 60/40 on only the marketable assets (so for this forum, this is likely waaay too conservative because there is also 2nd pillar etc.). We are probably missing out on lots of potential gains by being conservative, but even so I already found the book value decrease in 2022 on the stocks to be quite painful.

Our marketable assets are about 60% of our total wealth, about 20% is in the apartment, another 20% in pillars 3a and 2 (where we made some buy-ins). Because of the move to the Freizügigkeit with RE, I don’t expect any annuities from pillar 2 when hitting 65.

Based on our spending over the past years, I tried to estimate what we’ll spend in the future, but I find there is a lot of uncertainty. Apart from “normal stuff”, big items will clearly be health insurance, taxes, traveling, apartment upkeep, etc. What about additional health costs when you get really old? (I obviously hope for the getting old part without any huge health-related costs, but who knows.) Another uncertainty: will the Eigenmietwert stay? (My guess is yes.) Will it go up next year? (It looks like it with the Neubewertung 2025 coming in ZH.) So some uncertainties on taxes to pay in the future. I took into account that our child may want to study in the future and put something aside for that. (But will that take 3 years, 5 years, 10 years?)

Based on this spending estimate, our current marketable assets are around 25x of that, so that looks relatively ok I think, even if we manage to just beat inflation. However, in my planning of the FIRE journey over the next 20-40 years, I am very irritated by the (not surprising) huge effect of some of my assumptions. E.g. if I assume we’ll be exactly beating inflation, I think we should be able to just get by without selling the apartment. If I assume another percentage point of investment return, everything looks terrific. If I assume inflation will get bad and/or investments turn out worse by a percentage point in the other direction, we’d be broke in 30 years. I’ve read a bit about safe withdrawal rates. Those seem harder to get for Switzerland than for the US and I’m still not 100% sure but 2.5-3% look like a safe range. Then again, past performance may not predict the future. And for the safe withdrawal rate I included pillar 2&3, giving roughly 2.9% safe withdrawal rate. But P2&P3 may not give the same returns that are commonly assumed on investments. Any comments on all of this?

Would I be worrying too much if I considered longevity risk explicitly? The probability that one of us will live to be 100 years is at around 16%, so not super-small. We’d likely not travel any more at that age, but there may be other cost elements I’m not thinking of. (Of course the “risk” that both of us will live that long is very small. And for 50 years in the future, it seems that almost any planning will be close to impossible anyway.)

Maybe one concrete question to ask is: If this is really the last year both of us are fully working, should we do another pillar-2 buy-in? My gut feeling is yes: pros: highest tax savings now; future income in P2 will be tax-free (but income tax brackets will also be lower); it will not count for AHV wealth (I’m actually not 100% sure about this part, and wasn’t able to find a definite answer yet); cons: loss of flexibility. So, if yes, how much?

Are the recommended places for Freizügigkeit in this forum still Viac and Finpension?

I’ll close with our so-far luckiest and worst investments:
Luckiest investment: Buying a stock fund in late 2008 after thinking “the financial crisis cannot possibly be THAT bad for all companies”.
Worst investment: Buying some Credit Suisse stock after thinking “CS cannot possibly be in THAT bad a shape”. :slight_smile:

Thanks for reading, sorry for the long post. Any comments welcome!

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I lived through similar anxiety and solved it by moving from working full time to now working part time and experiencing living partially off my savings with a safety net of still some steady income.

Regarding the AHV payments for Nichterwerbstätige see here: 2.03.d (

Regarding VIAC versus Finpension: I would check with them how they handle the bond portion of your Freizügigkeitskonto. At the time I moved my previous employer’s pillar 2 into both VIAC and Finpension, VIAC held the bond portion of my portfolio in pure cash (sic!) at the WIR Bank. This meant that if they were to go belly-up, my cash would be guaranteed only up to the 100k …
Maybe this is different now as CHF bonds pay interest again.

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Welcome. Just some random thoughts

  • No annuity. Would you like one? Most pension funds have an option to retire early at 58 or 60. If your partner wants to continue a few more years, that might be an option on her side. Including the widow pensions, it would cover your risk of longevity as you put it.
  • Buy-in to pillar 2? I would do it, especially with your asset allocation and given your other assets. I actually started maxing it out in my 30s. Is your home fully paid? Otherwise, paying back the mortgage would be another option to get it out if you change. How much? You could look at your marginal tax rate, set a target like 40% (that’s taxable income of 355k) or 30% (somewhere around 145k) and then go until there.
  • About withdrawal rate. How much buffer do you have to lower your cost or down-size your home in a worst-case scenario? Or on the income side, at least in the next years is there any chance you might go back part-time or in a consultant role after some time off?
  • edit: any inheritances you can reasonably expect?
  • Eigenmietwert is likely to stay at least a few years, I would include it in the tax calculations. On the other hand, some renovations on the home come as well over the years
  • Support kid depends. I would expect 3-5 years and latest at 25 you can expect him/her to care for themselve. Cost is the larger variable. Is it an allowance, living at home and go to a public school? Or hundreds of thousands for tuition, housing and bord? I guess it’s a family decision what you are willing to finance and where you draw the line
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