Last update: 17.09.2024 08:34
Early withdrawal for home ownership (WEF) means that you use your pension assets before retirement to finance owner-occupied residential property. Dazu kannst du Mittel ganz oder teilweise auszahlen lassen oder verpfänden.
“Anything goes”: you can use funds from all sources. Regardless of whether they come from mandatory or non-mandatory occupational benefits insurance, vested benefits policies, vested benefits accounts or pillar 3a. An advance withdrawal for home ownership (WEF) is therefore a “cash withdrawal” from the pension fund or pillar 3a before retirement age in defined cases.
The purpose of the advance withdrawal for home ownership (WEF) is also quite broadly defined by law: you can use your pension assets to buy or build residential property, extend or convert it and repay existing mortgages. Or you can buy shares in housing cooperatives or similar investments. The residential property must only be owner-occupied in your main residence, not a fancy vacation home in the mountains or a second home.
The WEF advance withdrawal in pillar 3a differs in several ways from the WEF advance withdrawal from the occupational pension plan:
- There is no minimum amount for an early withdrawal in pillar 3a (2nd pillar: at least CHF 20,000). This is ideal for you to reduce a pillar 3a account that is “too large” to the desired target amount
- No blocking period for payments into pillar 3a: you can pay into pillar 3a again the year after a WEF advance withdrawal and claim the tax deduction. In pillar 2, you must first repay the early withdrawal before you can make a tax-efficient purchase
- No repayment obligation for 3a WEF advance withdrawals: unlike a WEF advance withdrawal from the 2nd pillar, no restriction on sale is entered in the land register, nor do you have to repay the advance withdrawal if you sell the property.
- the 3a WEF advance withdrawal is also not limited in amount. The 3a funds count as free equity, so you could use them to cover your 20% equity requirement of the mortgage lending value for a real estate purchase in full. The situation is different with a WEF advance withdrawal from the 2nd pillar: here you must contribute at least 10% of the mortgage lending value from your own free funds and can then increase this by 10% to the required 20% with a WEF advance withdrawal from the pension fund.
How much money can you withdraw as an advance withdrawal for home ownership (WEF)? This depends on your age: are you younger or older than 50?
And the early withdrawal will of course reduce the amount of your future pension benefits. If you withdraw money for f you need to pay for conversion and renovation work and do the work yourself, it’s a bit of a hassle. Firstly, you can only use it to pay for the cost of materials, not the work you have done. Secondly, your fund or pension foundation only pays invoices directly to the material suppliers.
Our tip: This is why it is often advisable not to make an advance withdrawal for home ownership (WEF), but to pledge your pension fund assets instead. Because then the pension protection does not decrease. Only if you are unable to service your mortgage and the bank wants to realize its pledge will your pension protection be lost in the amount of the pledged capital. But it shouldn’t come to that.
If you would like to know more, you can find out more about implementation at one of the largest pension funds look at or read the article on the “pension discussion” article.
