Where Can I Earn the Most Interest?

Savings accounts give savers a way to securely deposit money at the bank, and earn interest. That makes savings accounts ideal for holding an emergency fund or other money that must remain easily accessible.

Savings accounts are very popular. Nearly everyone in Switzerland has one or more savings accounts. Collectively, Swiss savings accounts hold hundreds of billions of francs.

Banks also pay interest on the balances of pillar 3a retirement savings accounts. Interest rates are particularly important for pillar 3a accounts. Often, tens of thousands of francs remain sitting in these accounts for the many decades leading up to retirement. Pillar 3a savings accounts offer a low-risk alternative for conservative retirement savers who shy away from investing all their savings in stocks and other securities.

The interest rates of both regular savings accounts and pillar 3a savings accounts vary broadly between banks. Comparing interest rates is important.

Which Swiss banks have the highest interest rates for savings accounts?

The average interest rate for standard Swiss savings accounts denominated in Swiss francs is just 0.12 percent per annum. That average is calculated across 142 savings accounts for adults. 

But the range between the highest and lowest rates is large. Depending on which bank you use, you could earn 1 percent interest per year, or none at all.

Although the actual interest rates for savings accounts frequently change, the banks with the highest interest rates often remain the same over long periods of time. If you open an account at a bank with an above-average interest rate, there is a good chance that you will continue to earn above-average interest in spite of changes to the interest rate. It is important to note, though, that this rule does not apply to temporary special promotional offers.

Important: Some savings accounts have low limits for notice-free withdrawals. Before opening an account, check whether the notice-free withdrawal limit corresponds to your needs. If you exceed the withdrawal limit without giving notice, the bank will charge you a two-percent penalty fee.

Which customers benefit from preferential interest rates?

In addition to standard savings accounts, many Swiss banks also offer special savings accounts for certain groups of customers:

• Youth savings accounts for children, teenagers, and young adults have higher interest rates than standard savings accounts for adults. Depending on the bank, customers can continue earning interest at the preferential interest rate up to the age of 20 or 30. Some banks also have preferential rates for students. The average interest rate across all youth accounts is 0.38 percent. The actual interest rates are as low as 0.05 percent or as high as 1.50 percent, depending on the bank.
• A few banks offer special accounts for senior citizens with somewhat higher interest rates than standard savings accounts at the same bank. The interest rates of savings accounts for seniors range between 0 and 0.5 percent.
• Only two Swiss neobanks still pay interest on account balances: Alpian (from 0.01 percent) and Zak (0.2 percent). Neon and Yuh do not currently pay interest.

The standard interest rate is more important than special, promotional interest rates. For example, a regular savings account from one bank may have a much higher interest rate than a special youth account from a different bank. The moneyland.ch savings account comparison lets you compare savings accounts based on your specific situation. The comparison accounts for youth accounts and student accounts in addition to standard savings accounts.

Where can I earn the most interest on my retirement savings?

Over time, your retirement savings can accumulate to where you have thousands or even tens of thousands of francs in a pillar 3a account. If you do not want to invest your retirement savings using a pillar 3a retirement fund or asset management solution, then having an account with a high interest rate is important. The higher the interest rate, the greater the effect that interest compounding will have on your final returns.

Many savers underestimate the compounding interest effect. The best way to underscore its importance is with a simple example: Let us say you held 50,000 francs in a pillar 3a account for 10 years. If you used an account with an interest rate of 0.1 percent per annum, you would earn 503 francs of interest. If, instead, you used an account with 1 percent interest per annum, you would earn 5231 francs of interest.

Currently, the average interest rate for Swiss pillar 3a savings accounts is around 0.27 percent. But the rates of individual banks range between 0 and 1.25 percent.

Banks also offer vested benefits accounts in which you can park your occupational pension fund benefits. The interest rates of vested benefits accounts are much lower than those of pillar 3a accounts. But because the money only remains in the account for the duration of a gap between jobs or a period of unemployment, using vested benefits accounts still makes sense in spite of the low interest rates. The interactive vested benefits account comparison on moneyland.ch makes it easy to find the offers with the highest interest rates.

How much interest do Swiss private accounts yield?

A private account, also known as a checking account, is designed for financial transactions, but not for saving. Most Swiss banks do not pay any interest at all for private accounts balances. But there are a handful of banks that do pay interest on private accounts. The Swiss neobank Zak is one example.

Private accounts for young people and students are another exception. Many Swiss banks pay interest for the balances of these accounts.

More on this topic:
Compare Swiss savings accounts and interest rates
Useful tips for using Swiss savings accounts
Find the best 3a savings account
Pillar 3a accounts: Key tips
Swiss medium-term note comparison
Tips for investing in fixed deposits and medium-term notes