I have quit my job and have no other job lined up. I might end up becoming self-employed or maybe be a Swiss salaried employee again.
Either way, I have received a letter from my last pension fund asking me what to do with my 2nd pillar.
What is the best way to “park” it while I look for another income source and if I don’t know if I’ll be an employee again in CH?
I’d love to cash it out all out and invest it myself, but I doubt that’s possible.
Any advice?
You need to open a vested benefit account. Best options are Finpension or VIAC. There are other threads on the forum or @thepoorswiss has a post
Once you open the account you need to decide your asset allocation based on your risk appetite
There is also the option to split your pension into 2 separate accounts to have “more flexibility” but not saying any more about that since last time other forum members objected and my post was taken down!
While these are good options for long term investment, investing the whole pillar 2 with a large equity allocation is risky if @boschika may go back to regular employment again relatively soon. The stock market may decline or even crash and when moving back to a regular pension fund at a bad time, you lose out on the recovery phase of the market.
It’s also possible to invest with a low stock allocation with finpension or VIAC but with the current bond market it’s doubtful whether that would yield better returns than a traditional pension fund.
If you actually become self-employed (sole proprietorship), you actually can cash it all out within 12 months of becoming self-employed. There may be certain conditions or caveats. I have no personal experience.
You can leave it all “parked” as cash in VIAC.
Not sure this is possible in FP.
Yes, at VIAC that’s possible. However, there is no interest and there is no deposit protection (I think up to 100k are privileged, though). At finpension it’s not possible, as far as I know.
Stiftung Auffangeinrichtung BVG may be better if the money just needs to be parked somewhere for a short while. Or maybe split the money into Auffangeinrichtung and VIAC/finpension, if that’s possible.
Thanks for the answers. I think I’ll just put it all in VIAC; from what I understand making two accounts is only if you’re planning on taking lump sums at age 60 so that you can split withdrawals over two fiscal years and lower your taxes.
Split it up. 50% to Viac and 50% to ValuePension.
But why? What’s the point of splitting it?
Gives you options, you can always merge it, but won’t be able to split it another time.
I agree. Not necessarily a bad idea, but risky. Especially in the current climate of tanking stock prices and foreseeable raises of interest rates by central banks (yes, it’s market timing. Then again, do you want to risk it based on the current environment).
Eggs in different baskets.
If one foundation goes belly up or proves to be a fraud…
I recommend parking it in 2 regular vested benefits accounts initially until you know what will happen next. The reason is that investments in the stock market can lose value over the short term. If you end up getting another job and have to subscribe to a new pension fund, you may be forced to sell out your investments at a bad time.
Once you are sure that you will hold your vested benefits long-term (e.g. if you leave Switzerland and cannot/do not cash out), then it makes a lot of sense to invest them (with Viac or finpension, for example).
Having your benefits in 2 accounts gives you more options when it comes to cashing out or transferring, and is also more secure, as San-Francisco mentioned.
You can compare vested benefits accounts here:
Totally aligned with your post.
I’m actually currently looking how to invest the 50% my future ex-wife will get from my pension. I figured if she’s better off so are my kids and indirectly so am I. She’s indépendant so now that we’re divorcing she’ll really need this money at retirement, but still 20 years away.
I’ve opened a vested benefits portfolio at Finpension and once I’ve picked the funds, I was thinking to open another and try to split the transfer into 2 accounts for flexibility…was thinking more aggressive on 70-80% for +-10years and and then bring risk down.
2 questions: 300k investment
To be honest, I would pick a standard strategy and if possible not exceeding 75% of shares; preferrably only 40-50% of shares max. Why?
You are currently on good grounds with her, which I think is great. But you don’t know how this evolves over the years. If anything goes terribly wrong in the investments (like she is confused and doesn’t know how to reduce share exposure in 10 years)… guess who she will blame? These things can go terribly wrong. So stick to a standard plan, and let her do the risk survey from Finpension to decide something among 30 and 75% of shares max.
As someone who’s been there and done that I would second TeaGhost and recommend that you keep things as simple as possible. My suggestion is that you just open a regular vested benefits savings account so that there is no risk of her money losing face value. If she later decides that she want to invest it, she can always transfer her vested benefits to an investment solution on her own and at her own risk.
I’m openly discussing with her now. Good advice from you and @TeaGhost of course.
Specific question below though that your advice has me thinking about…heres context: I’m happy with finpension and find it super easy to use so I had opened the vested account with them (her two 3a accounts also with them more conservatively invested than mine).
Now I realise that the vested accounts are also through Credit Suisse so I just wanted to double check based on the comment above: I’m comfortable with all the discussions about 3a accounts through Finpension (CS funds during buyout by UBS) and continuing strategy on existing funds in the meantime, but i’m wondering if there’s any reason to avoid CS completely for her and open the vested account somewhere else (which would be less convenient given 3a).
We’re thinking the vested account through Finpension and invested “99%” in a std mix on Swisscanto products (more conservative than originally planned), there’s no real risk to her account above std investing risk correct?
Only paranoid ? 
Edit: her pension (from job at 20% of income) is managed by SwissLife
To my knowledge, there is no special risk associated with Credit Suisse or Credit Suisse funds.
The only major risk I can foresee is that of her retirement savings losing value (even over the short-term), and her blaming you for recommending/coercing her into investing. But a lot has to do with her financial know-how and your overall relationship, so I’ll let you judge. From my personal experience, it’s best to keep things ridiculously simple when dealing with money and divorce.
If your (ex-) wife is currently insured for 2nd pillar benefits through her employer, the benefits she’s about to receive from you should be transferred to her current pension fund - not a vested benefits account.
At her lower than income she may hit the maximum amount that she can transfer in into the new pension fund - the excess amount in this case can be transferred to a vested benefits account (we just covered this in the other thread).
If she indeed requires one, I concur with Daniel‘s advice here:
Yes. Could be with VIAC or finpension (Valuepension) too, as long as she’s staying in cash a reasonable interest rate.
Maybe you‘d want to offer advice and also share your thoughts with her about what you would do and how you would invest these funds. But keep a low profile on this and don’t try to „convince“ her of anything. Anything more though… sure, as long as she officially makes the decisions herself, there will be no legal repercussions for you. But it still has the potential to create bad blood if the investment turns sour. She may (morally) blame you for the losses, friends and relatives may side with and blame you - possibly harsher than she would.
I didn’t know the order - thanks this does make sense and will help dictate the size of the decision whether to invest or not.
You are course 100% right in the advice. I’m acting as if it were still my money and what I’d do, when it’s not my money anymore. Thanks @San_Francisco @Daniel for saying what I needed to hear.