...or how you can ensure that there will be enough money for your needs, plans and dreams after you retire.
They are two sides of the same coin: Swiss women are mothers, partners, professionals and housekeepers. So they do a lot of work on all kinds of fronts. And yet women also suffer more than average from poverty in old age.
Perhaps precisely BECAUSE women are fighting on so many fronts? Yes, because that also means Much more part-time instead of full-time work - and this has a negative impact on retirement savings. "With 37 percent less pension, women are much more affected by poverty in old age than men," explains Tatjana Kistler from Pro Senectute.
Other reasons why women have less money at their disposal after retirement:
- Women live longer on average: The life expectancy of women in Switzerland is on average around four years longer than that of men. This means that they have to live longer after retirement with the money they have saved in their pension fund and third pillar. Every year, inflation reduces the purchasing power of the pension paid out.
- "Coordination deduction" has a negative effect: The annual salary insured with the pension fund is calculated using a so-called coordination deduction, which is always the same amount. For lower incomes (part-time employment), the fixed deduction has a very strong effect - leaving a disproportionately low insured salary. The pension fund assets therefore only grow very slowly for part-time jobs.
- Loss of earnings and unpaid work: Maternity is a common reason for temporary career breaks for women. Longer breaks after statutory maternity leave in particular have a negative impact on pension benefits. In addition, women usually do most of the care and household work for years - without being paid. However, only paid work results in pension fund assets.
- Precarious work situation: Eighty percent of working-age women in Switzerland are employed. This is a high figure by international standards. However, women often work in low-paid jobs in the healthcare and social services sector, in sales, in the hotel and catering industry or in cleaning. Especially during the lockdown in the coronavirus crisis, the paradox has become apparent that it is precisely these people-centered jobs that are particularly poorly remunerated, with twice as many women as men receiving only a low wage. More than a third of working women receive a net wage of less than CHF 3,000, which results in insufficient social security. This is later reflected in the fact that one in seven female pensioners is dependent on supplementary benefits. In the increasingly flexible labor market, conditions are also becoming more and more precarious: small part-time jobs - on an hourly basis and on call - are commonplace. As a result, women are three times more likely to be underemployed than men. In the event of divorce, which now affects almost every second couple, a low-paid employment situation often leads directly to poverty. This is because the household income then has to be sufficient for two households. Single parents, in most cases mothers, are therefore particularly often affected by poverty in old age.
What can you do as a woman to secure your pension?
Make private provisions and investments, not just through AHV and pension funds: The third pillar is often neglected in pension planning. However, it is key to being able to maintain your accustomed standard of living in old age. It is therefore best to make regular contributions to one or more pillar 3a accounts. It doesn't always have to be the maximum amount of CHF 7056; smaller contributions also help to build up your pension and live more comfortably in old age. You can also make significant tax savings by paying into pillar 3a. Are you a housewife and mother? Check whether you need additional insurance cover for this important work. After all, even unpaid family work has a monetary value if you can no longer do it yourself and it suddenly has to be done by a third party.
Maintain financial independence wherever possible: Not everything always goes as planned. And in the event of a divorce, the third pillar assets accumulated during the marriage are divided between both partners. In principle, cohabiting partners have no claim to their partner's assets. Discuss the case of separation/divorce with your partner at an early stage. Also think about your situation after their death. In this case, he or she can, for example, provide you with a life insurance policy as part of an unrestricted pension plan (pillar 3b).
Acquire financial knowledge: Acquire the necessary knowledge about budget planning and pensions. Our BEKB financial coaches will also be happy to advise you in a free and non-binding consultation. We will then draw up an individual financial plan for you. You will find out how you can best prepare for your retirement.
The distance of the Swiss Women's Run is 5 to 10 kilometers. The time horizon for investing for retirement is several decades. In both cases, the aim is to use resources - physical or financial - as efficiently and purposefully as possible. BEKB will be happy to advise you on all financial matters. Our aim is to provide you with tips and investment solutions tailored specifically to your needs.
This content is brought to you by our supporter BEKB. You can find out more at: www.bekb.ch/de/privatkunden/vorsorge
