Last update: 17.09.2024 08:34
Reto is 34 years old and is looking forward to spring – he can finally get out on his mountain bike more often again. His thoughts are of sunshine, mountains and nature. Understandable! And yet Reto should pay in his pillar 3a at the beginning of the year. We show you why.
Reto likes to balance his job as a teacher with outdoor activities with his partner in his free time. His partner Martina works reduced hours in an administrative office. The next tax payment is due at the end of the month and the money is just about enough. Reto and Martina pay into their pillar 3a shortly before the end of the year. The bank always writes to them towards the end of the year and then they still want to benefit from the tax advantages, that much is clear.
Paying into pillar 3a at the start of the year pays off
Do you feel like these two? Then you’re in good company. Around two thirds of employed Swiss people aged 25 and over pay into pillar 3a, and almost 70% of self-employed people do so. According to the Federal Statistical Office, even in the youngest age group (25-39 years), 6 out of 10 working people say they pay into it regularly. It’s not too early to invest in a private pension at 30. But you can get even more out of your money if you get into the habit of paying into pillar 3a at the start of the year. That way, you can benefit from the higher potential returns in pillar 3a for one year longer. Time is money. This applies regardless of whether you manage your pillar 3a as a savings account or in securities.
Our tip: Discover how much you can deposit
Pillar 3a maximum amount 2024: how much tax deduction is possible?
The pillar 3a maximum amount is redefined every two years at the latest in 2024.
Read the article to find out the maximum amount you can pay in for maximum tax savings.
Take advantage of the free reminder by e-mail – so you never miss a 3a payment again.
Better early than five to twelve pours extremely
The following comparison shows how much difference it makes to change your habit and pay into your pillar 3a at the start of the year. Reto still has a very long investment horizon until retirement and therefore invests his pillar 3a contributions in securities. So far, he has always paid in at the last minute at the end of the year. How much more will he get if he pays in the maximum amount at the beginning of the year instead of at the end?
Let’s take a look at the comparison with Zoé. She likes to get things done and decided to pay into pillar 3a at the beginning of the year.
| Investment amount 7,056 francs | Reto: pay into pillar 3a at the end of the year | Zoé: pay into pillar 3a at the start of the year |
|---|---|---|
| Yield per year | 6.7 % | 6.7 % |
| Investment period | 30 years | 31 years |
| 3a assets at 65 | 631,600 francs | 726,600 francs |
By making regular pillar 3a payments at the beginning of the year, Zoé ends up with around CHF 95,000 more in assets than Reto. She pays more into pillar 3a once and later receives 15% more assets than if she had paid in at the end of the year!
Our tip: Discover our best pillar 3a hacks
Summary of pillar 3a payments at the beginning of the year
This example shows how dramatically the compound interest effect is underestimated. Compound interest means that in the following year you receive interest on the interest received in the previous year – this leads to exponential growth. The longer you invest, the larger your investment capital and the higher the interest rate, the greater the growth. Time makes money. Pillar 3a is particularly suitable for investing in equities due to the very long-term investment horizon, allowing you to tap into their return potential. You should therefore pay into pillar 3a at the beginning of the year.
Mach den ersten Schritt zur finanziellen Unabhängigkeit
In einer Minute siehst du deine Vermögensentwicklung und dein Einkommen während der Rente.
