Last update: 17.09.2024 08:32
Want to manage your retirement savings easily and conveniently? Then our frankly 3a experience could show you the way to a good solution. In this experience report, we’ll tell you all about frankly pillar 3a and show you whether it’s the right choice for you.
What is frankly 3a?
frankly 3a is the digital ZKB pillar 3a pension solution from Zürcher Kantonalbank. It was launched on the market in March 2020. frankly 3a allows you to manage your pillar 3a (or vested benefits) pension provision easily and conveniently via an app or web access on your computer or tablet. frankly 3a offers a wide range of investment strategies. So you can pretty well design your plants according to your needs.
Who is behind frankly pillar 3a?
The Zurich Cantonal Bank (ZKB) is behind frankly 3a. It is one of the safest universal banks based in Zurich. Although ZKB has its origins in Zurich, its products are available throughout Switzerland and abroad, where they also enjoy a high reputation.
In 2020, Zürcher Kantonalbank celebrated its 150th anniversary and can thus look back on a history rich in tradition. In 2014, it acquired the asset manager Swisscanto Invest in full. Swisscanto is one of the largest Swiss fund providers with a good reputation. frankly 3a therefore relies on Swisscanto for its investment products.
How does frankly 3a and registration work?
frankly is an easy to use app and web solution. It offers five different investment strategies. You can choose your investment profile and product according to your needs and change at any time.
You can open your account with your cell phone and ID or online without any paperwork or bank visits. The process is self-explanatory and simple. You need a Swiss cell phone number for this.
Only the decision “active or passive products” might cause some trouble for less experienced investors. As we have already shown in various articles, we prefer passive, i.e. indexed products. Numerous studies have shown that active products do not deliver better returns than passive products over longer periods of time. On the contrary. Neither beginners nor experts beat the market in the long run. No Swisscanto fund managers either 😉
You can later manage frankly pillar 3a both via app and in the web version (since 2023).
Benefit from a 35 franc bonus with frankly voucher code SMOLIO
Use the code SMOLIO for your welcome bonus when opening an account. You get this as a fee credit if you deposit or transfer at least 1 franc within 3 months. In addition, if you redeem a voucher between 01.01.24 and 31.12.24, you will automatically be entered into a prize draw to win 1 x 1,000 francs in cash.
What is frankly’s experience in terms of costs?
frankly 3a offers a favorable fee structure compared to other pillar 3a providers.
The all-in fee is currently 0.45%, 0.44% (since 15.1.2024), which is very competitive compared to other providers.
The all-in fee is a flat rate that does not depend on the strategy chosen, the investment product or the equity component. As of July 1, 2023, it is no longer levied on the cash portion of assets. Settlement is on a quarterly basis pro rata to the invested assets. Cash assets also earn interest. The interest rate has been 0.70 % since August 1, 2024.
This means that the fees at frankly 3a are transparent.
Certain costs are not included in the all-in fee and are detailed on the website. This relates to any issue and redemption fees for indexed investment products and fees and ancillary costs that are charged directly to the investment product (e.g. bid/ask spreads, commissions, taxes, duties and the total expense ratio (TER) of exchange-traded real estate funds).
What is the minimum deposit?
frankly 3a has neither a minimum deposit nor a minimum term. You can pay in from 1 franc. So “too little money for 3a” is no longer an excuse! Starting from 5 francs your money will be invested in additional shares of the chosen investment product. This will be done 1-2 days after receipt of payment.
Note: frankly does not assume any issuance and redemption fees in favor of the investment product as well as costs related to 3a insurance policies. Unfortunately, there are significantly higher costs in the event of premature termination of your pillar 3a contract.
What investment products does frankly 3a offer?
frankly pillar 3a offers five different investment strategies, ranging from “security-conscious” to “opportunity-oriented”. You can opt for an active investment product or an indexed investment product, both of which have the same equity allocation. Share quotas of 15, 25, 45, 75 or 95 % are possible. The product names indicate whether it is an active or index-linked product (active/index) and the number tells you how high the equity allocation is.
Addendum 20.11.2023: The product range for active investment products was expanded in November 2023. You now have the choice between “responsible” and “sustainable”. frankly distinguishes between two different levels of sustainability: investments in “responsible” are based on the Paris climate target as standard (i.e. ESG investing), while “sustainable” invests in companies and countries that contribute to the fulfillment of one or more of the UN’s 17 Sustainable Development Goals (SDGs).
You therefore have a choice of thirteen different investment products. On a quarterly basis, frankly informs you about the development of your investments.
| Investment strategy | Active products (responsible) | Active product (sustainable) | Index products |
|---|---|---|---|
| safety-conscious | Light 15 responsible | (none) | (none) |
| careful | Gentle 25 responsible | Gentle 25 sustainable | Gentle 25 Index |
| balanced | Moderate 45 responsible | Moderate 45 sustainable | Moderate 45 Index |
| ambitious | Strong 75 responsible | Strong 75 sustainable | Strong 75 Index |
| opportunity-oriented | Extreme 95 responsible | Extreme 95 responsible | Extreme 95 Index |
How does frankly 3a implement my investment strategy?
For the implementation of your investment strategy, frankly uses target funds that track different benchmarks. The target funds in indexed investment products charge issue and redemption fees, which, as already described, are not included in the all-in fee. For example, these amount to 0.23% / 0.07% (issue / redemption) for the “Moderate 45 Index”.
You will not find the target funds directly on the frankly website, but via the detour at Swisscanto. There you have to search a bit laboriously for the factsheets on the respective target fund to understand what you are investing in. Alternatively, you can download them in the app or when logged in. For example, it remains opaque what you are investing in with the “Extreme 95 Index”. The fact sheet states that you invest in the target fund “Swisscanto (CH) IPF III Vorsorge-Fonds 95 Passiv NT CHF”, the investments of which are made “mainly via indexed investment funds of Swisscanto”. Okeee, I would like to know which benchmark my retirement assets are running against and how my product performs against the benchmark.
The fact sheet further states that “the share of unhedged foreign currency positions can be a maximum of 30%.” In other words, Swisscanto hedges the exchange rate fluctuation of foreign currency positions against Swiss francs. This is a sensible approach in the short term. For long-term investors who are building up their pension provision in particular, forced foreign currency hedging costs valuable returns.
How can I invest sustainably with frankly 3a?
The active investment products take sustainability aspects into account. This is not the case with passive products.
Since frankly invests in Swisscanto investment products, you benefit from the sustainability efforts of this fund provider in the active investment products. Thus, Swisscanto invests your money with frankly according to ESG criteria, excludes certain companies from investments and also conducts engagement dialogues with individual companies. Sustainable investing with frankly costs the same and no more than the passive investment solutions – everything is covered by the All-In Fee. I think that’s fair, and not all competitors do it that way.
Our frankly experience 2024: These points are quite unique
Invest in stages
You can open both a 3a savings account and a securities account with frankly.
If you don’t have much experience in investing and don’t want to invest “all at once” in shares, you can invest gradually. Or you can pay your savings contributions into a Pillar 3a account and then invest when you see fit. In another post, we explored how you can best invest a larger amount.
By default, frankly is set to automatic investment mode. You can adjust this to “independent“, then you have control.
Volume discount
The more customers invest their money with frankly, the lower the costs. It works like this: The all-in fee decreases when the total investment volume of all frankly customers reaches the next threshold. At present (15.1.2024), the investment volume has exceeded CHF 2.5 billion.
The all-in fee has therefore been reduced and is now 0.44 %.
The next stage of the boldly named “community discount” will be reached at CHF 2.5 5 billion.
There will then be 1 basis point less in fees and the all-in fee will fall to 0.44 % 0.43 %.
Break-free
frankly pays the transfer fees charged by the transferring pension foundation when you close your 3a savings account or sell your 3a securities solution when you transfer your pillar 3a. You can find out more here.
What are the advantages of frankly 3a?
- Simple and user-friendly user interface available via app and web
- Fast opening process that takes only a few minutes and does not require a visit to the bank.
- Already from CHF 1.- can start
- Wide range of investment strategies
- Favorable fee structure with transparent costs
- Sustainable strategies are not more expensive than “traditional” strategies
- Investment takes place already from 5 francs investment amount
What are the disadvantages of frankly 3a?
- All-in fee does not completely include all fees
- Maximum equity exposure is limited to 95
- Sustainable investing is only possible in the active investment products
- Many customers are overwhelmed in onboarding with decision for active or passive products
- Forced foreign currency hedging costs returns
- Lack of transparency in the target funds of the investment products
- Only customers domiciled in Switzerland can be and remain frankly customers; if you move abroad and give up your domicile, you must close your account
- US persons cannot become frankly customers
How does frankly pillar 3a compare to other solutions?
Compared to other pillar 3a solutions, frankly performs excellently thanks to the advantages mentioned above.
Which is better in comparison: frankly or VIAC or finpension?
We think: all three solutions have their merits. We have examined each solution in separate articles. In our opinion, frankly, VIAC and finpension all offer good value for money and the costs are close together. After all, these are the three “pacesetters” at the top of the digital pension market in Switzerland and are not giving each other any favors.
The best way to get an idea of the providers is to use our Pillar 3a product finder.
Summary: our frankly experience 2024
frankly is a user-friendly app and web solution that allows you to manage your retirement savings easily and conveniently. It offers many investment strategies and a favorable all-in fee, which is very advantageous for portfolios with a high proportion of equities. ZKB’s backing makes frankly interesting for many who are looking for a modern and digital pillar 3a solution from a world-renowned universal bank.
Open your 3a with a 35 franc bonus now with frankly voucher code SMOLIO
Use the code SMOLIO for your welcome bonus when opening an account1. You get this as a fee credit if you deposit or transfer at least 1 franc within 3 months. In addition, every frankly voucher code SMOLIO redeemed between 01.01.24 and 31.12.24 automatically enters you into a prize draw to win 1 x 1,000 francs in cash.
Notice
Wir sind dir dankbar, wenn du bei einer Kontoeröffnung unseren Code nutzt. Wir erhalten dann eine kleine Vergütung. Für dich wird es dadurch nicht teurer und wir können die Kosten für den Betrieb der Plattform decken. Wir freuen uns auch, wenn du uns einen Kaffee spendierst ☕️.
Further FAQs on frankly pillar 3a
How many pillar 3a accounts can I open with frankly?
You can open up to five 3a columns in total. So, on the one hand, you can close your accounts tax-efficiently at different points in time. On the other hand, you can also implement up to 5 different investment strategies.
How can I change my investment strategy?
If you want to change the investment product or strategy, you can do so at any time for free in the app or on the web.
How much interest is paid on the 3a savings account with frankly?
Currently (since August 1, 2024) you get an interest rate of 0.7 % there
Who can use an account with frankly?
You must be resident in Switzerland and at least 18 years old. Customers residing abroad cannot hold an account with frankly. If you emigrate, for example back to Germany, you must close your 3a account with frankly. There is no legal requirement to close your account if you emigrate. You can therefore transfer your frankly 3a account to a provider that supports customers resident abroad. Please note that the sale of your securities may result in losses depending on the stock market environment. So if you already know today that you will be moving away from Switzerland in a few years’ time, another 3a provider might suit you better.
If you are a US person, you cannot open an account with frankly.
As with all providers, you may only pay into pillar 3a if you have an income subject to AHV contributions. You also need a Swiss cell phone number to register.
How secure is frankly?
We consider the solution to be state of the art. Onboarding in the app or web version works with your cell phone, so it’s personalized to you. When logging in later, you’ll need to authenticate with more than your password or Face ID. That is the standard today.
As is usual with 3a solutions, your assets are held in a pension foundation. Even if ZKB were to fail as a provider of Frankly, your pension assets would not be affected. The ZKB is only the administrator, the assets are held by the foundation.
Therefore, we have absolutely nothing to criticize about the security of Frankly Pillar 3a.
How can I transfer my pillar 3a to frankly?
frankly offers an easy way to transfer existing pillar 3a accounts from other providers. The process is digital and no bank visit or paperwork is required. Rather unusual and top for you: frankly takes over the costs that the transferring pension foundation charges you for an account balance or the sale of your previous securities. How does the transfer reimbursement work? To do so, send your bank’s expense report to: support.frankly@zkb.ch. Frankly will give you a discount on the all-in fee in that amount and will notify you once they have processed your statement. Please use our frankly voucher code SMOLIO when transferring to benefit from the opening bonus.
- / *: Only redeemable for frankly new customers when opening their first account within 48 hours. There is no all-in fee for cash. Code cannot be combined with other voucher codes. Valid until 31.12.2024. Information on the competition at frankly.ch/gws. ↩︎
