Four tips for retirement planning: how women can get a better retirement

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First the bad news: the extreme difference has structural reasons that only politics can remove. The Swiss pension system is based on as continuous employment as possible, preferably full-time. Those who do not live according to this pattern, and the majority of them are women, save less or no capital at all in their pension fund. This takes its toll as you get older.

The good news: everyone can do something about it. However, the amount varies depending on your personal and financial situation. What’s important:

Here the injustice is smallest; the system automatically provides compensation because, for example, the years of childcare are taken into account without the woman having to pay premiums. The amount of the AHV pension paid differs only slightly by gender. In total, women receive 55 percent of all pensions, while men pay about two-thirds of the premiums. This is partly due to pensions for widows.

It is important that no premium differences arise between the ages of 21 and 64. This means that AHV premiums are paid every year – even if you do not work or only work partially. Married people have an advantage here: if the spouse works and pays AHV premiums, the non-working partner is usually also insured. Premium differences lead to a lifelong reduction in your pension. This has a much greater impact than a pension that is not as high because you earn less than others.

Tip: Inquire with the AHV whether you have such premium differences. If they were created within the last five years, they can be closed retroactively.

For women, occupational pension provision is the biggest challenge, because the income level has a direct influence on the amount of the future pension. In addition, there are systemic injustices: anyone who earns less than approximately 22,000 francs per year per employer is generally not affiliated with a PK and does not receive a company pension at all in old age. Part-time employees are also penalized because the lowest 25,000 francs in wages do not count towards the PK (the so-called coordination deduction). The lower the workload, the more negative the effect.

If you can choose your employer, you should choose the one who has a progressive PK. This means: ideally without any coordination deduction or with a deduction that varies depending on the level of employment. Anyone who has several part-time jobs can insure their entire income with the BVG support institution or possibly with one of the participating PFs. This will greatly increase your future pension.

Tip: Where possible, increase your workload to at least 50, preferably 70 percent. Only in this way can you realistically reach a pension level that you can live on in old age.

The best option to close the retirement gap – if you can afford it. The less money you can expect from AHV and PK, the more important private provision becomes. Either individually with money in the savings account. Or via the subsidized pillar 3a, where the state subsidizes approximately a quarter to a third through tax deductions.

Anyone connected to a PK can deposit a maximum of 7,056 francs per year in pillar 3a. Anyone who does not belong to a PK, such as self-employed people or part-time employees with low wages, can contribute 20 percent of their net income, up to a maximum of 35,280 francs. If you are married, one partner may pay the premiums for the other. But please note: anyone who has no income from work and is not registered with the RAV as a job seeker is not allowed to contribute to pillar 3a. The only thing left here is the savings account.

Tip: Start saving for old age in Pillar 3a as early as possible. Deposit the maximum amount if possible. The longer it is until retirement, the more likely it is that 3a stock portfolios will be considered. Get advice, for example at the Observer Advice Center.

Housewives or women who work part-time are often financially dependent on their partners – and this takes its toll when separation or divorce occurs. For married couples, there is in any case pension equalization: the money saved during the years of marriage in the AHV, pension fund and pillar 3a is divided equally, regardless of who paid how much.

Cohabiting couples must take action themselves in these harmonious times: first register the partner in their own PF – as a rule, you are required to live together for at least five years before the cohabiting partner is treated as a spouse. Secondly, honestly record in a contract what happens if you separate: who pays whom, for what, how much and for how long?

Tip: Please seek professional advice before drawing up such a cohabitation agreement to avoid undesirable consequences. Otherwise, the benefit partner will have to suddenly pay gift tax, for example.

Source:Blick