Struggle with AXA 3A life insurance

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1

Hi Mustachians!

I’m the happy reader of MP’s new book and very willing to make changes in my life. Here is the situation: we contracted end 2020 a 3A pillar life insurance with AXA… (no comment, we didn’t know).
Obviously since beginning of the year, my husband and I give 290CHF per month each that goes to that 3A pillar (we wanted at first to have half of our pillars in life insurance). We would like to have you advice if we should both directly close these 2 pillars and move on with VIAC or something alike and just call it quit on the fact that we might just get back ~200CHF each for what we gave them, or if we should close them in a few year (obviously what the guy selling it to us, told us to do).
For the rest, we were planning on moving our pillars which are on different banks, and thus doing nothing, to VIAC & Co ? WDYT? We have about 40K the 2 of us in different accounts and wondered how it worked in terms of fiscality if we move everything this year? Also, what we gave to AXA won’t be taken into account I am guessing at the end of the year for the taxes?

Sorry for so many questions, and most of all, thanks for the help!
FYI: we’re based in Lausanne, Vaud.
Cheers,

Solène

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Moving funds between 3a accounts and from 3a to the second pillar has no fiscal consequences.

3

:thinking: I was not talking about the second pillar :sweat_smile:Was just saying that we have 3A pillars on different bank accounts my husband and I (the 2 of us).

4

Sure, sure. You can move 3a to 3a as much as you want. There is even nothing to declare for the tax declaration.

5

Thanks for that particular question! Let’s see what other people think about that life insurance issue :woman_shrugging:

6

Whatever they think, in the end it is your decision. There are many such stories in this forum.

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7

That life insurance question has been answered countless times. Have you searched for it? Consensus seems to be to get out and cut your losses.

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8

Yes, I researched it on the forum, but all of them were for people in the life insurance for a few years now, thus a much higher return value when buying out. I was more concerned in believing or not the guy who tells us to stay 2-3 years.

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Maybe you can find some more information here. You should get the numbers and make a calculation. Retire In Progress - Trolling my first “Financial Advisor” Part 3 of 3 – Insurance Policy Pillar 3AB

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10

The surrender value will be higher in a few years, yes. You will also have poured much more money into that scheme. I paid around 23k in and got out 14k. Percent-wise, it might be better, in absolute terms… not so much. Also considering that I could have invested that for 4 years in a reasonable way.
If you get out now, you will only get small change (if anything) back. But you’ll be free to invest your money as you wish, which will be more profitable long-term.
3a-life insurance combos are notoriously hard to calculate. But if one tries, even the best-case scenario loses hard against separated 3a and life insurance.

Edit: thanks Sjess for the Link. RiP has more articles on this topic (most recent blogpost for example).

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11

I love this way to express it - like it’s a disease. :grin:

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12

Thank you everyone! :pray:

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The longer you keep it the more you lose, whether through opportunity cost or simply through an expensive insurance that you might not use.
Been there, done that, got a 13k T-shirt that I call in hindsight “financial education” :wink:

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14

If you cancel it within 12 months, the guy who sold it to you has to pay back the provision.

Do it now.

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