Pension issues.
| Auteur | MacGeorge, Nigel |
| Fonction | Switzerland |
The Swiss pension system is geared towards retirement after a "normal" Swiss working life of 40 years of paying contributions both into the state pension (AHV/AVS) and into a company pension scheme. Most expats only spend a part of their working life in Switzerland and therefore at retirement age will often be lacking at least a few of the precious contribution years into the pension system. In order to be able to maintain a suitable lifestyle, private retirement planning is essential. The kind of retirement savings scheme or investment that is best for you depends on many factors: where are you going to retire? At what age do you want to retire? How much money will you need to have the lifestyle you are used to?
Why is where you want to live so important? One of the big issues is tax. If you choose the wrong sort of pension investment, its final value can be significantly reduced by taxation. Many countries promote long-term personal savings to reduce the burden of state pension costs in the future by offering special tax privileges to certain investment categories, provided they are used for long-term investments like pension planning.
Examples include in Switzerland the so called 3rd pillar; in the UK, Personal Pensions - soon to be superseded by new Stakeholder Pensions; in France, the DSK life insurance contracts; and in Germany, special savings plans. In countries where - unlike Switzerland - married couples are taxed separately, it also might be worthwhile to split investments so a part is in the husband's and a part is in the wife's name.
It is wise to consult an independent financial adviser at least six months before the actual move or retirement in order to structure your investments in the most beneficial way, although it is also worthwhile to talk to an expert at any time. Tax can eat up a large part of your savings when you move to another country if you have relied on the wrong type of investment, or you get the timing wrong.
You may find that investments or savings schemes you started before you came to Switzerland work in a completely different way now. Larger or smaller changes may need to be made to improve their tax efficiency - ask your independent financial adviser how you will be affected.
A few more Swiss and international tax and pension issues:
As long as you are resident in Switzerland, you are taxed in Switzerland on all of your worldwide income (no matter where it originates) and on all of your assets, including...
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