I remember back in the pre-VIAC days the best offer used to be by cantonal banks (ZG or LU, don’t remember). Then PostFinance went ahead with 75% stocks (and 1% TER, yeah…).
What does the current landscape look like? I stumbled upon an offer from SZKB and it looks good from the first glance. Am I missing something? Are there better options?
- 99% stocks (32.3% CH — required by law, AFAIK)
- TER(?): 0.35% (What’s a “V-Tranche”?)
- Hidden fees: ??
Parent page: https://www.szkb.ch/pub/privatkunden/vorsorgen/vorsorgeprodukte/szkb-vorsorgefonds
Looks like they have an additional (?) custody charge of 0.40% p.a. for 3a accounts with less than CHF 250,000. But it’s all not very clear.
https://www.szkb.ch/docs/default-source/produkte/produktinfo/konditionen_anlage.pdf?sfvrsn=d41cfc49_34 (page 5, “Vorsorge”)
You seem to recognize that VIAC is the best offer currently on the market and yet you are asking for alternatives. Why?
Regarding your questions:
- Yes, 30% CHF is required by law (with some leeway), see BVV2
- V-Tranche = Vorsorge-Tranche = BVV2 conform
Additional fees were just linked by @mso. And not only do they ask for 0.40%/p.a. up to 250k, they also ask for up to 0.55% for both each buy and sale transaction!
So to answer the question: How is the landscape looking like? Cantonal banks and the two big ones still are a steal, they simply learned to offer ok-ish looking products, and rip you off with other fees.
I think it’s good to know and see competition in 3a is catching up. At least the “97% stock” argument of Viac is gone now. That’s a start.
Well, overall Viac might still be the cheapest long-term offer in 3a at the moment - but they too have rip off hidden fees, for example the max. 0.75% FX markup you pay on both buying and selling (besides the more hidden spreads and non-zero TERs some of their CS funds have). 3a investment offers in CH are just still way too expensive.
Thank’s for answering the question. I do like to see more competition, precisely because VIAC is far from ideal.
Regarding VIAC’s hidden fees, I haven’t heard about the 0.75% FX markup. Where can I verify it? As to the additional ETF TERs, they are not at all hidden, I would say. It’s true that they are being compensated by the ETF providers, but that’s the part that is not included in TER anyways (although, I would like to see some transparency there as well).
They are hidden, they don’t want to be too visible… but Viac officially confirmed here: A new low commission 3A/3rd pillar ETF solution from VIAC
How about Postfinance then? They are launching Postfinance Pension 100 (= 100% shares) on Nov 4th 2019. According to marketing material, TER will be 0.98% with no other fees.
Corner 3 Funds from Corner Bank is an alternative to VIAC.
On the positive side it has a lower flat admin fee (0.3% vs VIAC’s 0.52%). The funds used by VIAC have 0.18% TER, while the index funds from Corner (they don’t offer ETFs) have 0.30% TER. So total ongoing costs are 0.6% with Corner 3 Funds vs 0.70% with VIAC.
On the negative side, I don’t believe Corner lets you invest nearly as much in stocks as VIAC does.
VIAC is 0.5-0.6%, where do you get the 0.7%?
VIAC 0.52% is administration fees normally. And then you add the TER which should be low.
The 0.7% I calculated is based on the 0.52% admin flat fee plus a 0.18% TER for a global portfolio. Grant it, that 0.7% is the highest possible cost, as stated on the VIAC website. It is for the most diversified portfolio with maximum stocks.
Hi thepoorswiss, fund fees are charged in addition to the VIAC admin fee. These can be very low or fairly high depending on your portfolio. 0.7% is the most you can possibly pay for the most diversified portfolio with maximum stocks. It is difficult to compare 1/1 with Corner 3 Funds because Corner only has a handful of funds to choose from, and only 2 are affordable. VIAC portfolios are more diversified.
P.s. Do you write thepoorswiss blog? I’m a keen reader.
You are right. I assumed that everybody would use the Global 100 portfolio with a much lower fee than 0.2 (0.03% for Global 100).
Yes, I do I am glad you like it!
One interesting note: I requested more info from Corner as I am considering them for the last 1/3 of my pillar 3a allowance (other 2/3 are divided between VIAC and another service provider). They offered me a 0.15% admin fee if I sign up this year. I’m still contemplating it. As for VIAC, I only opened an account with them a few months ago (on thepoorswiss’ recommendation actually :). I’ll review after-cost performance at the end of this year and readjust my portfolio if needed.
Product cost for the 97% world protfolio is 0.03% for a TER of 0.55%
The corner fund has mostly bond. Which one are you speaking about ?
UBS AST BVG-25 Indexiert (hedged in CHF) I-A1
UBS AST BVG-40 Indexiert (hedged in CHF) I-A1
Both of these have 0.3% TER. The rest of their funds are more expensive.
To tell you the truth, I haven’t gotten around to study the funds in detail yet. My proposal of Corner 3 as a possible VIAC alternative is based on the admin costs only. As I said above, I don’t use them myself yet, so I can’t speak from experience.
Funds will less stock are cheaper:
You need to take comparable funds with VIAC:
- Global 20 TER 0.18% including admin fee
- Global 40 TER 0.30% including admin fee
As you can see, Corner is more expensive
100% agreed. You could only really compare Corner 3 1/1 if they expanded their fund selection. But it is the only pillar 3a solution I’ve found which competes with VIAC price-wise as its admin fee is low. I’m sure there are others out there which I have not come across. I know of banks which don’t charge you brokerage or custodial fees when you buy their own funds, but their funds have insane TERs so not an alternative. VZ Depotbank uses a flat-fee model and has a good variety of funds, but their flat fee for pillar 3a accounts is a fair bit higher than VIACs. Does anyone else here know of any low-cost investment solutions for pillar 3a assets?
None with such low cost and such proportion of stocks - at least yet.
That’s why VIAC is the bee’s knees atm.