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Benefits in retirement

Upon retirement, benefits from the first pillar (AHV) and the second pillar (pension fund) become available. Together, these two pillars form the financial foundation for your retirement and are designed to cover around 60% of your latest income. For a worry-free retirement, it is important to understand the different benefits and to plan how they can be combined to maintain your standard of living.

Leistungen im Alter - desktop

Overview of benefits in retirement

Our services are there to support you in planning your financial security in retirement – with a clear focus on the best possible use of AHV, pension fund, and further retirement provision options.

1. Benefits from AHV
2. Benefits from the pension fund
Leistungen aus der AHV - desktop
Old-age and survivors’ insurance (AHV) is the federal basic pension, providing a base income in retirement.
  • Full pension: You receive a full pension if you paid into AHV for the entire duration of your working life.
  • Reduced pension: Gaps in contributions reduce your pension. These gaps can be closed through additional payments.
  • The pension amount depends on the average annual salary and the contribution period.
  • Maximum pension (as of 2025): CHF 2,520 a month.
  • Minimum pension: CHF 1,260 a month.
  • Married couples receive a maximum of 150% of the maximum pension, i.e., CHF 3,780 a month.
  • Early drawing of pension: Possible one or two years prior to retirement, at a reduction of 6.8% a year.
  • Deferred drawing of pension: Possible deferral by up to five years, which increases the pension by 5.2% to 31.5% depending on the time deferred.

How to proceed

1

Analyze and plan your AHV benefits

  • Determine your contribution period and calculate your expected pension.

  • Decision on early, standard, or deferred drawing of pension.

2

Analyze pension fund benefits

  • Analyze your pension fund statement: Understand the amount of your prospective annunity and your overall savings.

  • Decide on annuity, lump-sum payment, or a combination of the two.

3

Tax optimization

  • Advice on the tax impact of a lump-sum payment and ways to reduce the tax burden.

4

Long-term planning

  • Combination of AHV, pension fund, and other sources of income to ensure your standard of living.

Videos on "Retirement benefits"

Altersvorsorge: ohne freiwilliges Sparen geht es nicht - desktop

Retirement provision: Voluntary saving is indispensable

Learn why voluntary saving for retirement is absolutely essential and how pillar 3a provides a tax-advantaged way to accumulate such savings. Moreover, we explain practical steps to analyze your financial situation and set savings goals as well as how you can take into account key aspects of diversification and risk assessment.

(in German)

Lieber Alf, wie hast du deine Altersvorsorge geregelt? - desktop

Dear Alf, how did you organize your retirement provision?

In this video, Alf talks openly and honestly – and somewhat tongue-in-cheek – about his retirement provision. Take a look!

(in German)

st.gallen - desktop

smzh for you

Your advantages with smzh with regard to retirement benefits:

Personalized advice: Analysis of your AHV and pension fund benefits, tailored to your needs.

Clear explanations: smzh helps you clearly understand your pension fund statement and your pension entitlements.

Optimal decisions: Support in choosing between annuity and lump-sum withdrawals, as well as creating a tax plan.

Comprehensive planning: Integration of all income sources into a holistic retirement strategy.

Pension fund savings, built with contributions from employees and employers as well as interest income. These assets form the basis for retirement benefits of the 2nd pillar.

  • Use: Retirement assets can be drawn either as annuity, a lump sum, or a combination of the two.
  • Importance: The amount saved has a direct influence on one's rent and, as a consequence, financial security in retirement.

The rate at which retirement assets are converted into an annual pension. The conversion rate is defined by the pension fund itself and may vary.

  • Sample calculation: Assuming retirement assets of CHF 500,000 and a conversion rate of 6%, the annual pension amounts to CHF 30,000 (CHF 500,000 x 0.06).
  • Trend: The conversion rate has been gradually reduced in recent years due to rising life expectancy and low interest rates.

The estimated pension based on retirement assets and conversion rate, paid annually or montly upon entering retirement. This number is listed on the pension fund statement.

  • Basis for calculation: Includes extrapolations that assume further contributions and interest income until retirement.
  • Factors of influence: Changes in the conversion rate or unexpected contribution gaps can influence the prospective retirement pension.

The legally defined age at which insured individuals can start drawing a pension from their pension fund.

  • Current age: 65 years for both men and women (as of 2025).
  • Early or late retirement: The drawing of penions may be brought forward (involves cuts) or deferred (involves increases).

A set amount that is deducted from gross salary to calculate the salary subject to coordination that is relevant for pension fund contributions.

  • Function: The coordination deduction ensures that the part of the salary that is already covered by AHV is not also insured by the pension fund.
  • Example: Assuming a gross salary of CHF 80,000 and a coordination deduction of CHF 25,725, the coordinated salary amounts to CHF 54,275.

Term describing the assets that result upon leaving a pension fund and are transferred to a vested benefits account.

  • Use: The assets are restricted until retirement, but can be withdrawn early under certain circumstances (e.g., to buy residential property or when emigrating).
  • Management options: Vested benefits accounts can be held at banks or insurance companies.

Describes the receipt of one's retirement assets in full as a one-time payment instead of a monthly annuity.

  • Advantages: Flexibility in terms of asset management; assets can be passed on to heirs.
  • Disadvantages: Greater financial risk; tax burden due to one-off payment.

Option to receive one's retirement savings as a monthly or annual pension/annuity.

  • Advantages: Guaranteed lifelong payments, regardless of one's age or market conditions.
  • Disadvantages: No flexibility and no possibility to pass the assets on to heirs upon death.

A fund that supports occupational benefits establishments (pension funds) in guaranteeing the legal minimum protection.

  • Function: Guarantees the payment of minimum benefits even if a pension fund is in financial difficulties.
  • Financing: Contributions from all pension funds.

A technical interest rate is a discount rate used in pension funds and life insurance to calculate the present value of future liabilities.

  • Influence: A low technical interest rate often leads to a reduction of the conversion rate.
  • Development: The technical interest rate is regularly adjusted to economic conditions.

The legally mandated interest rate that must be applied to the mandatory portion of retirement assets in a pension fund.

  • Level as of 2025: The minimum interest rate is at 1.25%.
  • Additional benefits: For supplementary (also called extra-mandatory) assets, a pension fund may set its own interest rates.

Benefits that go beyond the mandatory minimum defined by law and that are determined by the pension institution itself.

  • Examples: Higher interest rates on retirement assets or additional risk benefits.
  • Meaning: Supplementary benefits can make a significant contribution to financial security in retirement.
  • Defined contribution plan: The amount of pension benefits depends on contributions made and interest income.
  • Defined benefit plan: The amount of pension benefits is defined in advance, with contributions calculated accordingly.
  • Trends: Most Swiss pension funds operate according to a contribution-based system.

Benefits paid in the event of permanent disability as a result of sickness or an accident.

  • Amount: Dependent on the degree of disability and retirement savings accumulated to date.
  • Supplementary benefits: Spouses and children often also receive survivors' benefits.

Pension fund benefits paid to surviving spouses or children in the event of death.

  • Widow's/widower's pension: A percentage of a person's insured salary or retirement pension.
  • Orphan's pension: Monthly benefits for surviving children up to a certain age (usually 18 or 25 if in education).

Retirement assets paid into a vested benefits account when leaving a pension fund (e.g., due to a change in jobs).

  • Importance: Ensures that retirement savings are not interrupted.
  • Use: May be withdrawn early for specific purposes such as buying residential property or emigration.

We handle questions such as those shown on the right on a daily basis. You don't need to deal with them by yourself – our 360° Check-Up is free of charge and non-binding.

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The application should be submitted to the relevant AHV office no later than three to six months prior to the desired start of retirement. We can support you in submitting your application correctly.

The decision depends on your financial situation, your goals, and your risk tolerance. We help you find the best solution.

Deferring the start of your pension withdrawal by up to five years leads to a higher monthly payment. smzh shows you the effect of a deferral and supports you in planning such a step.

The pension fund statement includes details about your retirement assets and supplementary benefits such as disability or survivors' pension.

Yes, the benefits from AHV and pension fund are complementary and help protect your standard of living in retirement. We develop a holistic strategy for your retirement benefits.