Pillar 2: BVG funds

Dear all,
I just recieved my pillar2 statement for 2017 and it is horrifying:
they managed to grow my stache by 0.9% (substract 0.5% inflation…) where VT went up 22%. Of course the don’t put 100% equity in, but… 0.9%! And i am kinda legally forced to sufer from that :face_with_symbols_over_mouth:

so, since i will leave my current employer in the next months, i will first try to get the money out of pillar 2 (self employment, real estate purchase,…). if this fails, i can use one of the BVG funds that allow at least 45% stocks.
the typical bvg 45 funds made accordingly ~8% last year, which is a ‘bit’ bettert than my pension fund:

Anyone has experience with this?
any other 2nd pillar funds with >40% stocks?
any thought?

The correct course of action is to treat it as a bond component of your portfolio. Low returns are expected given today’s low/negative interest rate environment

With lots more risk and quite a bit of money lost to friction and fees

real estate purchase

This is not really a way out, the money will then stay in RE. If you sell you’re forced to pay all the money back into the fund

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Important insight!

having another 33 years before i can get hands on this stache otherwise, i am clearly in for the risk of more (100%) stocks (given proper diversification…)

my pension fund has also some costs. I found the number of 0,21% in the 2016 Geschäftsbericht page “B”, that compares to 0.36%TER of the swisscanto fund (i may mention the combine Ausgabe-und Rücknahme spesen from together 0.24%). i am clearly willing to pay this considering the above numbers. not interested in bonds at the current markets & stage of my life

You can get the money from pillar 2 any time actually, just pop out of the country for a few months. you said you’re EU, right? so it’s no problem to come back any time later, just need a job offer in hand. It’s pointless to come here without one anyway. Or you could even stay abroad. Chances of getting a good paying job in tech are much higher in the US. And US taxes are not that much higher than swiss for high earners, esp. in the states without state income tax

Meanwhile you’re saving some good money by avoiding swiss taxes on pillar 2 payments, that should compensate these low low interests somewhat

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Yeah, second pillars… In my quasi-freelancer company I can either pay out what I make as bonus or let it get invested into second pillar as employer contribution = tax & social contribution free. I was really thinking hard about it, because it could save me 40% right from the start, but in the end I didn’t decide to invest anything.

I didn’t know that you can chose another pillar 2 provider. How does this work ?

Only if you quit your job, otherwise it’s up to the employer and you have no say

Ha ha ha… another guy thinking he is a victim of Publica.
I am actually in the same boat as you and there are global issues with Publica:
The Swiss government never paid all the money it would have to pay to Publica when it was splitted from the government.
The people already retired get too much rent respective to the money they accumulated while active.
The pension found is managed with short term vision (the boat shall not sink the next two years) than with a strategy over one generation as it should be.
The result is poor return and permanent decrease of the conversion ratio to the point it will soon apply the 4% rule but for people that are 65 years old.
The advantage of Publica is that it is a hole without bottom in which each year you can throw tens of thousands swiss francs that are tax deducible.:weary:

if you become self-employee right ? If you find a new job, you will need to transfer the funds to the new pension fund.

I will change employer soon and I want to use this opportunity to get my current pension fund stash out of my current pension fund (publica) as they are burning my returns to dust.

Currently my idea is to open an account with LuKB and invest the stash into Swisscanto (CH) Vorsorge Fonds 75 Passiv VT CHF. Clearly my goal is again to optimize for return on a 35 years horizon.

does anybody have experience with this/ knows better solutions/ could share any advice?

Key numbers:
0.43% p.a. fund TER
0.27% p.a. LuKB account fee (Administrationspauschale incl. VAT)
0.15% purchase fee of the fund (Ausgabekommission)
0.08% selling fee of the fund (Rücknahmekommission)
0.4% purchase fee of LuKB
0.4% selling Fee of LuKB

0.7% total TER
1.03% loss to buy & sell

fuck that’s expensive. but better than the pension funds, that earn 6.7% and pass on 1% to me :face_with_symbols_over_mouth:

Viac wants to open up for Freizuegigkeitsgelder pretty soon. A bit of waiting might bring you much reward.

Your new PK wants that money but can’t force you. It does reduce your ability for buy-ins.

You can also make them pay it out on two accounts.

+about 1% for chf hedging with all the risks should this bet go wrong

Are you planning to live here for 35 years? The moment you emigrate you can cash everything out (or almost everything if heading for EU and some other countries) and swap for better alternatives

yes, i forgot. however better than paying 5% sorry-the-returns-are-not-for-you-fees with about any pension fund

at the moment i dont plan to leave switzerland but who knows what the next 30 year wil bring