Old age pension

Scheduled saving for an appropriate old age pension

Occupational pension funds (second pillar) are built around a savings plan which starts at 25 years old and ends when retirement age is reached. A requirement for this is AHV (old age and survivors insurance) earnings above the entry threshold in accordance with the Federal Occupational Retirement, Survivors’ and Disability Pensions Act (BVG).

The pension regulations of the respective employer determine the amount of the annual employer and employee contributions to fund the retirement credit and calculate from this the anticipated, obligatory and non-obligatory old age pensions.

The savings premiums which are paid in are credited to the individual account of the insured person and invested by the pension fund in the financial market. The yield of the investments is used in principle for the regulated payment of interest for the obligatory and non-obligatory retirement credit balance. Surpluses are used to build the value fluctuation and interest reserves or for supplementary payments of interest for the retirement credit balance.

The retirement credit balances saved over the years are converted into regular old age pensions or early disability or survivors benefits.

The regulations determine the interest and pension conversion rate.

  • The obligatory and the non-obligatory retirement credit balances are paid standard interest in accordance with the regulations of Inter Pensionskasse (interest 2017 = 2.00%).
  • There is also a standard conversion of the obligatory and the non-obligatory retirement credit balances into old age pensions in accordance with the regulations of Inter Pensionskasse (conversion rate 2018 = 5.4%).