Wow thats an amazing Pension with about 500 at 40.
You must have both a very good salary and a good pension. I won‘t have 200k by the time I‘ll be 40.
I’m reaching 45 in a few months and my 2nd pillar is ca. 200k…
Either my employers have had very bad pension plans or yours are very favourable…
I won’t have 100k by 45.
Welcome to the club then !
~115k with 40
~215k with 45
~380k with 50
~595k with 55
Indeed, as during young age the contributions (in % of the coord. salary) are relatively low (7% 25-34 and 10% 35-44), if you star making - say- 125k / year (already pretty good salary, difficult to get as entry point…) you would save an yearly 7% of 125 - 25 = 100k → 7 k/year
With this kind of saving and the non existent interests on pillar 2…
You’re so well informed about stuff, shorting TSLA and what not, I’m surprised you didn’t secure a well paid job. I’m in this country since 5 years and already accumulated 100k in pillar 2. (I really mean it non sarcastically)
Of course that‘s a good point to look at. Apart from government and big corp who has a good pension fund? Most companies in Switzerland are small/medium.
I completely agree. The pension scheme of a company can make a huge difference in the total compensation and therefore also in the net worth! As an example: Apart for compensating the change in the conversion rates (Umwandlungssatz), my employer also pays 60% of the contribution (40% by me) and the annual interest has in the past years always been 2.5%.
I was really surprised by our number when I put the figures together, an am further surprised when I compare it to those mentioned in this tread. My wife for example contributes “only” 100k to the 500k , although we worked for equal years at similar %.
Ok, this might be it, sorry if I misinterpreted. It’s just that my employer pays the bare minimum and the rest is left to me. So far I never decided to pay anything extra, so I thought that accumulating 200k at 45 should be easy with a good salary.
If you had the choice would you prefer to put more of your salary in 2nd pillar? Yes, you do save on taxes, but the money is locked and subject to potential future political adjustments. (E.g. in Poland they recently disbanded pillar 2 and moved it all to pillar 1, lol)
Can you elaborate this ? If I get it correctly the total contribution is still 100% so this should not make a difference in the total growth of the 2nd pillar
As I intend to work long-term for my current employer with an excellent pension scheme (assumed 2.5% interest p.a.), yes i would. For me it is the perfect “bond” in my asset allocation
Yeah what’s up with that? My employer pays 100% of my pillar 2, still doesn’t change anything. Also how is 2.5% possible? All pension funds have to follow the same conservative guidelines, so how does this one manage these returns?
For my age 37 the contribution is in total about 27% of the “insured salary”. 60% of the 27% are paid by the employer, the rest by myself
The interest rates fixed by the government are minimal rates! The effective rate can be significantly higher and depends on the “Pensionskassenreglement”. I.e. if the pension fund has good returns, low costs, reserves, they are allowed to give you more interest
Ok fair enough. But all pension funds strive to get good results. So maybe your fund performs well now, but can it “beat the market” forever? I’m sorry if sounds silly, I don’t really know much about how these funds work.
Care to share a link or two to these purported wealth progression posts of mine?
Call it lack of formal education and/or programming skills - coupled with personal interest in sectors and jobs that pretty much have those as a prerequisite to hiring.
I’m just an ape armed with screen and keyboard who’s decent at googling and finding things.
…and historically tends to be an appreciating currency.
The asset allocation of a pension fund is highly dependent on the structure of its members (ratio of “young” paying and “old” pension receiving members) → Structural different asset allocation = different returns
Furthermore, pension funds of companies can of course be generous, if they are additionally founded/financed by the company or have excess reserves. If your pension solution is from a private provider (i.e. SwissLife), there is much less motivation to pay more than the minimum …
OK, I see, then your employer is much more ‘generous’ - with the 27% contribution - vs. the LPP mandatory contribution which is only 10%. This also means that your contribution is much higher than the minimum, being 0.4*27 = 10.8% (vs. 5%).
I think this hugely depends on the sector you are employed into. I’m in civil engineering, currently with my 4th employer, but all of them (each one with a different Pensionskasse) were insuring the minimum (at least regarding the percentage; my previous one was at least insuring the whole salary…)