retirement saving investing pillar 3a switzerland
Investing & Retirement

How to Choose the Right Swiss Pillar 3a Retirement Saving Solution

January 12, 2024 - Raphael Knecht

Are you interested in using the Swiss pillar 3a to save for retirement? Find out which kind of pillar 3a solution is right for you in this guide.

If you save for retirement, or would like to, using the Swiss pillar 3a can be beneficial. As an employee, you can place up to 7056 Swiss francs per year in pillar 3a retirement savings. If you do not participate in an occupational pension fund, you can put up to 35,280 francs per year in the pillar 3a. Contributing to the pillar 3a can pay off in two ways: Firstly, you save towards your retirement; secondly, you benefit from tax deductions.

But tax benefits aside, which pillar 3a retirement saving solution is best for your situation? Get useful information and tips about pillar 3a savings accounts, retirement funds, asset management, as well as life insurance, and find out which is the best fit for you here.

Pillar 3a savings account

Ideal for people with low risk tolerance and for short-term saving

A pillar 3a savings account is a bank account which you can use to save for retirement. It is the simplest way to use the pillar 3a, and pillar 3a savings accounts are offered by many Swiss service providers. You can easily find out which bank offers the current best interest rate using the pillar 3a retirement account comparison on

The advantage of pillar 3a savings accounts is that, as with other bank accounts, the risk of losing money is minimal. But in exchange you earn relatively small returns when interest rates are low. The low interest also detracts from the compounding interest effect, so that during extended low-interest periods, the returns do not impress compared to those of other pillar 3a solutions. On the upside, you do not need to worry about downward fluctuations. The money you deposit into your account will always be in the account. You can find out how much interest you could earn at current interest rates using the pillar 3a account comparison.

The most important factor for choosing a pillar 3a savings account is the interest rate. On the whole, the interest rates of pillar 3a savings accounts tend to be higher than those of regular savings accounts. But in addition to comparing the interest offered by banks, it is also important to consider fees and charges – such as possible charges for closing a pillar 3a account. Applicable fees and charges are clearly shown on the detailed product information pages for all accounts included in the comparison. You can find more useful tips in the guide to using pillar 3a retirement accounts.

Pillar 3a retirement funds

Ideal for people with higher risk tolerance and long-term investment goals

Pillar 3a retirement funds let you invest your retirement savings in stocks, bonds, and other securities. The process is similar to opening a pillar 3a savings account. You open a pillar 3a investment fund account with the bank or other service provider which offers the retirement fund you want to use. You can then and deposit or transfer money into that account, and that money will be invested into the linked fund.

Compared to savings accounts, retirement funds have historically earned much higher returns. But because the stock market can fluctuate heavily, there is a risk that the value of your pillar 3a assets can go down over the short term. So using retirement funds is not recommended if you plan to withdraw your pillar 3a assets in the near future. The rule of thumb: You have to be able to leave your money invested in funds for at least 7 to 10 years. If you will reach retirement age soon (at which point you will be forced to withdraw pillar 3a assets), pillar 3a retirement funds are not the ideal solution for you.  

Choosing the right fund is also important. The higher your risk capacity is, the bigger the stock component of the fund can be. Once you have determined how much risk you can take on, you should compare funds which match your risk profile to find the most affordable option. You can easily compare total costs using the Swiss retirement fund comparison on

Passive, accreting retirement funds normally deliver the best returns. You can find more in-depth knowledge in the guide to choosing pillar 3a retirement funds.

Pillar 3a asset management

Ideal for people who are digitally savvy and have long-term investment goals

Pillar 3a asset management solutions – particularly those offered directly online or through mobile apps – provide a viable alternative to retirement funds. Like retirement funds, digital asset management services let you invest your pillar 3a savings in stocks and other securities. But your money is typically invested in an array of funds and/or securities rather than just one. Some also let you add pillar 3a accounts to your portfolio.

Make sure to compare the costs when choosing an asset management service. Once you have made your choice, the process of setting up your portfolio is normally simple. You generally receive assistance in choosing the right portfolio for your risk capacity. In most cases the whole process – including ongoing portfolio management – is done completely online, so a certain level of digital affinity is required.

The main costs to include in a price comparison are the flat rates charged for asset management and the ongoing costs of the funds or other investment vehicles used. Digital pillar 3a asset management services are typically cheaper than pillar 3a retirement funds. You can find detailed information about the costs in the guide to digital retirement asset management services. Because these services are relatively new, it is not yet possible to accurately compare their historical performance.

Pillar 3a life insurance

Ideal for people who need life insurance and do not use up their full pillar 3a allowance for retirement savings

In addition to retirement saving solutions, you can also take out term life insurance and disability insurance under the pillar 3a private providence category. The premiums you pay can be deducted from your taxable income as part of the pillar 3a tax deduction. Unlike retirement saving solutions, pillar 3a insurance is used to financially protect you or your dependents against possible hazards, rather than for building wealth.

The key difference between pillar 3a life insurance and regular life insurance (pillar 3b) is that you cannot name the beneficiaries. These are dictated by law. If you die, the death benefit will always go to your spouse. If you do not have a spouse, the benefit will go to your legal heirs in a very specific order.

Whether or not using the pillar 3a for insurance makes sense for you depends on your specific situation. You can easily find the right term life insurance for your needs using the Swiss term life insurance comparison on

Important: Many Swiss insurance companies also offer permanent life insurance under the pillar 3a, and market it as a pillar 3a savings solutions. As a rule, recommends that you avoid using any form of permanent life insurance – including mixed life insurance – for your pillar 3a because insurance policies are very binding. Using separate solutions for saving or investing and for insurance is generally more favorable financially and also gives you much more flexibility.

More on this topic:
Compare pillar 3a retirement accounts now
Compare pillar 3a retirement funds now
Get informed about pillar 3a retirement asset management services
Compare term life insurance (pillar 3a and pillar 3b)
How to use the pillar 3a to save on taxes
Where can I earn the most interest?
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Editor Raphael Knecht
Raphael Knecht was an analyst and a specialized editor at until the end of February 2023. Since then, he is supporting the editorial team as a freelancer.
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