In Zurich with a salary of gross 130k, single, no children, no religion, you have a marginal tax rate of 30.7%.
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I agree that 35-45% on average is a tad too high.
I wouldn’t underestimate the salaries of the people here in the forum, there are many tech people here earning way more than 150k 
Also the median salary is 80k and the 75% quantile is already 106k.
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Fair- I did an over simplification based on the audience in the forum. in any case even if it’s not 35-45% but 28-38% you may run the calculation for your case and calculate the overperformance you need.
The important point here is that , the tax savings are guaranteed return , they are significant and it should be calculated by marginal rate which is important especially in our peak earning years.
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You also have to account for taxes when withdrawing the capital, though. As far as I can tell, the relevant rate is the difference between the marginal income tax rate and the future withdrawal tax rate. This is especially important for withdrawal of a large amount from a pension fund, which can only be spread across two tax years, if I remember correctly (not five tax years like 3a).
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My marginal tax rate is 25% btw. So if I increase my net salary by CHF 300, that will be CHF 225 after taxes.
Assuming 20 years and avg. yield of 2.5%/year for pension funds, my stocks need to perform 5%/year to match that. Not accounting for income taxes though.
exactly. You may fine tune the calculation including wealth tax & dividend tax & transaction costs on one side, PF withdrawal tax on the other side.
you will have to figure out if it’s worth or not, but PF investment is not automatically bad. It can be thought like fixed income part of an overall portfolio.
My calculation based on a marginal tax rate of 25% is that your stocks would need to perform 4% p.a. net, not 5%. (Ignoring taxes on withdrawal and wealth taxes)
For every Franc invested in a pension fund you’ll have CHF 1.64 after 20 years.
Outside the pension fund you can only invest CHF 0.75 of every Franc earned and after 20 years at 4% p.a. that will have grown to CHF 1.64 as well. With 5% p.a. it would have grown to CHF 1.99.
Or do I need more coffee?
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The calculation is quite complex you need to take into account the following points:
- Income tax. There is no income tax on dividends on the money in the pension fund
- Wealth tax. There is no wealth tax on the money in the pension fund
- Returns/yield of the money inside and outside the pension fund
- Tax when you withdraw your money from the pension fund
Obviously, the result could be different in each canton.
I think that @Bojack created an excel sheet or did some simulation on this topic.
Personally, I like to do buybacks to reduce my marginal income tax rate.
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Suppose the annual return from a pension fund is 1% whilst return from shares is 4.9%. Y only needs to be ~10 years.
The right thing to do depends on return assumptions and how long you plan to keep working. I keep in mind that some pension funds have been paying <1%
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I was in a similar position to you. I minimized my contributions and put everything into 3a and taxable investment accounts. But now I changed my mind, I have increased contributions to maximum and will back-fill my pension with voluntary payments.
I wish I’d done this sooner as I would have been able to reduce my taxes at the highest marginal rates for the last decade. Instead, I will now drastically reduce my taxable income over the next 3 years and then I plan to retire and transfer the pensioned amounts into a Vested Benefits account to be invested into equities free of income tax and wealth tax.
If you have high marginal tax rates, are likely to change jobs or likely to buy a house, you have no worries about the amounts been locked up or having low returns (returns are great for bonds and on job change, you can squirrel them out to a VB fund and have equity returns tax free).
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Damn it, my pension fund will again give me a pretty amazing yield this year.
2023: 9%
2022: 7%
2021: 9%
the years before: 2.5-3.5%
Should I stick with the lowest contribution option of 2.5% of increase it to 8%? What about my 20k 2nd pillar at Finpension? Leave it there invested in stocks or transfer that too?
Lol, I thought mine pays a good interest with 4.5% this year 
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Is it possible to determine the amount AXA will pay for FY23 at this time?
Mine is 0.9% for 2023
2.3% for the last 6 years.
How could they perform so bad?!
Can you contact your trustees to understand why there is such a high return and whether it is likely to continue? You should have employee representatives
Deckungsgrad is close to 130% and the fund has a solid performance every year.
But good idea, I‘m going to write them an E-Mail.
If you go 8%,does the company pays 8% as well for his part?
No thier contribution stays the same.
I’m sure you wrote it somewhere, but I’m too lazy to search, how much does your employer contribute?
My options: Low 2.5%, Standard 6.5% and High 8.0%. Employer is always at 6.5% no matter which option I go for, so there is no matching. I’ve been at the Low option for most of the time I’m working there, but the latest yields got me thinking if I should change my strategy.