Is it recommended to do a 3rd pillar?

This question is the same as asking ourselves about the very usefulness of the 3^th pillar. Half of the population already has at least one, but let's see the reasons and benefits that push people to take action and adhere to this type of solution.

Retirement and the 3^th Pillar

Although retirement still seems far away, the statistics exist and all point in the same direction. The private pension section, which includes the 3^th pillars will gain momentum. In fact, the accumulation of 1^Er pillar (AVS) and pension fund (LPP), bring us to an income equivalent to 50-60% of our last income at retirement age. This is true for a person who has contributed every year since the age of 21 in Switzerland. Indeed, current interest rates, life expectancy and the ratio between active insured persons who contribute and pensioners do not encourage optimism about the improvement of retirement in the future.

People who are farsighted will have an advantage and will have the choice, for example, of early retirement or even of a improving their retirement income.

Buying real estate and the 3^th Pillar

Whatever the choice of your 3^th pillar, it will be possible to do something with it if your dream is to buy real estate. It will be useful in 2 forms: your own funds (20% of the purchase price is required), including 10% in cash or via a 3^th pillar) or as amortization (indirect in Switzerland).

The 3^th pillar is a base for future purchases and the Swiss system is perfectly in line with the implementation of this solution.

Lending institutions for your purchase, via a mortgage, consider the types of 3 differently^th pillar and you really have to make a good choice among the solutions on the market. It is also useful to do an analysis to determine what happens in the event of incapacity for work or death in order to maintain your real estate.

Becoming independent and 3^th Pillar

More than one person dreams of starting his own business one day but does not have the necessary reserves. If your family is not in a position to help you, you are left with bank loans with all the difficulties you can imagine. The 3^th pillar is a much simpler alternative.

Like the pension fund, the 3^th Pillar A serves as the starting point for self-employment in the sense of AHV as its main activity. You have one year from obtaining self-employed status to have your 3^th pillar A and your pension fund. The 3^th Pillar B is available at all times.

Being self-employed means the absence of pension fund coverage. The addition of coverage in the event of death or disability is becoming important in the 3^th pillar of your choice.

Taxation and the 3^th Pillar

Strongest argument, the tax advantages generated by the solutions of 3^th pillar (especially the 3^th pillar A) are guaranteed returns that have no equivalent on the market.

80% of people make a 3^th pillar A for that reason. Who does not want to take advantage of an advantage granted by the Confederation in order to promote private pension provision?

In fact, saving around 30% of the amount invested in a 3^th Pillar A remains an excellent financial transaction.

In conclusion

Rare are the people who do not find an interest in a solution of 3^th pillar. The various advantages granted by the State in terms of taxation and inheritance are too interesting to give them up. The death and disability coverage that can be added brings added value to the need to take out a 3^th pillar.

In the end, the 3^th pillar is recommended in order to carry out your projects safely.