How to save for your dream house or apartment

Tax-privileged saving with private pension provision

The 3rd pillar of the pension system comprises private provisions. It enables you to accumulate assets, and offers many other benefits.

Pillar 3a

Pillar 3a assets are referred to as “tax-qualified provisions”, as they are tied up until you retire. However, there is an exception: you can use your third-pillar capital to finance owner-occupied residential property. It then forms part of your equity.

If you are in employment, you can pay a maximum amount of CHF 6833 into pillar 3a every year. As a self-employed person without a pension fund, you can pay in 20% of your net income, up to a maximum of CHF 34 416 per year. Married couples can pay in double the amount, but into two accounts. The main wage earner may pay in the spouse’s allowance.

Pillar 3a is also tax-privileged. You can fully deduct the amount paid in, and thus save up to CHF 2000 in taxes a year. Calculate your pillar 3a savings potential using the tax savings calculator.

At the same time, you are preparing for your retirement with pillar 3a. The accumulated capital in pillar 3a is paid out for retirement, thus ensuring your accustomed standard of living in old age.

Pillar 3b

Pillar 3b assets are referred to as “non tax-qualified provisions”. Your capital in this pillar is not tied up and can take many different forms, such as insurance policies, securities, funds or savings accounts. You can deposit the amount you have saved in pillar 3b as collateral when you buy your own home. At the same time, you can insure such risks as disability and death.

If certain conditions are met, for example cash value life insurance financed by periodic premiums and single premiums are exempt from tax. Only 40% of Pillar 3b pension payments are taxed – in contrast to pensions paid out from pillar 3a capital, which are 100% taxed.

Voluntary payments to the pension fund (2nd pillar)

You can make voluntary purchases in the 2nd pillar. You can accumulate your pension fund assets, which you can then use to buy your own home. If you increase your pension fund assets, your payouts after retirement, and possibly your risk benefits will increase as a result. At the same time, payments from your private assets can be deducted from your taxable income.

• Ten percent of your accumulated equity may consist of pension fund assets, i.e. the 2nd pillar.
• Your pension certificate shows the amount of voluntary purchases you are allowed to make in your particular case.

Investment solutions

You can also invest in an investment solution in order to benefit from higher interest rates and earnings opportunities. To do so, you should first determine with your advisor the optimum investment strategy for you. “Optimum” means an investment that precisely meets your personal needs for returns, security and availability. It is also important that the system adapts when your needs change.

When saving for your own home, it is also important to know when the money from the investment will be available. As a rule of thumb: The longer the period until payout, the less important any potential price fluctuations will be, as they can recover over the long term. With investment solutions you can also save up by making regular small deposits.

You can find more information about what an investment solution is and how it works here

How we can help you make your dream of owning your own home come true.
 

• Together with you, we draw up a budget plan and determine your additional optimisation options
• We'll show you how to save for your future home in a tax-optimised manner.
• We explain other sources of financing for your home
• We can support you in drawing up a savings plan to enable you to realise your dream of owning your own home more quickly.