Swiss ETF and Mutual Fund Saving Plans: Cost Comparison

A fund savings plan automates the process of investing in the stock market. In recent years, new offers from online service providers have brought new competition to the market. Many banks have reacted by improving the pricing of their own fund savings plans. 

This new analysis by online comparison service moneyland.ch shows that there are still big differences between savings plan offers from different service providers. The selection of mutual funds and ETFs that you can choose from is one point on which offers differ broadly. Some service providers only let you choose from a handful of funds, while others let you choose from more than 100. The costs of saving plans, which also vary between offers, are made up of the fees charged by the savings plan provider, on the one hand, and the fees charged by the mutual funds or ETFs used, on the other.

Low costs and broad diversification are key

The huge selection of plans and funds available can make finding a suitable savings plan very challenging for some consumers. Personal finance expert Ralf Beyeler from moneyland.ch names the two central criteria: “The most important factors are, firstly, low fees. Secondly, it is advisable to use a diversified investment portfolio with stocks from many different parts of the world.” 

Ralf Beyeler explains further: “Using an ETF or index fund that tracks a global stock index is a simple way to create a diversified stock portfolio. You can also use a global stock portfolio from an asset management service provider.” You should be aware, though, that most global stock indexes have disproportionately large US components. Because of that, it can be beneficial to extend your portfolio with Swiss or European stocks, and with additional asset classes.  

Before investing in stocks or other securities, it is important to carefully consider the risks. Being able to deal with temporary losses in the value of your savings is a prerequisite to using fund savings plans. If you are prone to panicking and selling your assets when their value falls, then a savings plan based on investment funds is not the right fit for you. 

These are the cheapest Swiss savings plans

In order to compare the different offers with each other, moneyland.ch created a cost simulation. The simulation is based on the assumption that 200 francs per month will be paid into the savings plan over the space of 10 years, with the savings plan being liquidated at the end of that term.

Saxo Bank currently offers the cheapest Swiss stock savings plan. The total cost for a savings plan using an ETF that replicates the S&P 500 index is 80 francs over the 10-year term. Saxo Bank also has the lowest costs for a savings plan with a broadly diversified global ETF, at 261 francs.

Two neobanks, Neon and Yuh, take second and third place. The cost of using a savings plan with an S&P 500 ETF over the 10-year term is 193 francs with Neon, and 325 francs with Yuh. Both of these neobanks also offer an ETF that replicates the global FTSE All-World stock index. The total cost with the global ETF is 301 francs with Neon and 386 francs with Yuh. 

There are savings plans from Avadis and the Basellandschaftliche Kantonalbank that have total costs of 194 and 303 francs respectively. However, these low costs only apply to savings plans with money market funds or bond funds, which are not a suitable basis for a fund savings plan. Savings plans from Avadis and the Basellandschaftlichen Kantonalbank that use stock market funds are more expensive.

Big cost differences between ETFs

Even savings plans from the same service providers can vary in cost depending on which ETF or mutual funds you use for the plan. For example, the total costs of savings plans from Neon vary between 193 and 1414 francs, depending on which ETF is used. “You should always pay attention to the total expense ratios (TERs) of ETFs and mutual funds,” advises Ralf Beyeler. “Some service providers are very transparent in the way they show the TERs of funds. With others, you have to research the needed information yourself.”

There are also savings plans for which the cost is similar no matter which mutual funds or ETFs are used. Findependent, as well as standard portfolios from Finpension and Viac, all stand out because their total costs all fall within the same bandwidth. These are the only stock fund savings plans included in the analysis with total costs of between 600 francs in the best case and 700 francs in the worst case. It is worth noting though, that Finpension and Viac also give you the option of putting together your own custom portfolio, and the costs can be higher than those of the default portfolios.

Swiss savings plan cost comparison

The graphic below shows the total costs of fund savings plans from Swiss banks, neobanks, and other service providers over a 10-year term, as per the moneyland.ch cost simulation.

The graphic shows the major differences between offers. While the cheapest savings plan has costs of just 80 francs, the total cost of using the most expensive savings plan is nearly 4000 francs.

The comparison reveals that offers from many online service providers are much cheaper than many offers from established Swiss banks. One reason for that is, service providers that only offer their products online primarily use low-cost ETFs for their savings plans. Many established Swiss banks, on the other hand, use more expensive mutual funds. Another possible reason for the lower costs is that online service providers may have lower overheads than conventional banks due to not operating branch offices.

Fund savings plans for children

Many Swiss fund savings plan providers also have offers for children. These are often referred to as gift savings plans. In recent years, online service providers have also begun offering these plans. Conventional banks, in particular, often charge lower fees for children’s savings plans, compared to standard offers for adults. But it is worth noting that even discounted children’s plans are often more expensive than the cheapest available savings plans.

Find more information in the moneyland.ch guide

You can learn more about using Swiss savings plans in the moneyland.ch guide to fund savings plans. You can also get a detailed comparison of fund savings plans as a PDF.