The previous three posts of the series covered the three pillars of retirement in Switzerland:
In this final post of the series, I am going to summarize over the entire system. I am also going to talk about how early retirement works in this system.
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I started this series with details about the first pillar. I then continued with information about the second pillar. This post will cover the last of the three pillars, the third pillar. This pillar is the only one that is not mandatory. Everybody is free to choose to invest in the third pillar or not. It is simpler than the second pillar. But there are much more choices than you can make.
In this post, you will find all the details you need to invest in a third pillar. And also, what you can do to optimize your use of this last pillar.
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We have studied the first pillar and Switzerland three pillars system in the previous post in the series. Now, it is time to see the second pillar. The first pillar covers the basic needs of everybody. The second pillar is here to cover a larger part of your salary than the first one. If you never worked, you will never pay anything for this and you will never receive anything from this. It is significantly more complicated than the first pillar.
In this post, I am going to try to give you as much important details as possible on the second pillar. I am also going to try to help understand what you can do to improve it.
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Switzerland retirement system is based on a system with three pillars. Each pillar is paid in a different manner and will cover different needs. If you are working in Switzerland, it is important to know these three pillars. This will help you plan your retirement.
In a series of posts, I will try to give you enough information on these three pillars. The goal is that you have a good understanding of how they work. And also what you can do with them to improve your retirement. In this first post of the series, I will introduce the system and talk about the first pillar.
Continue reading “The first pillar of retirement in Switzerland”
I have monitored my net worth since October 2017. But until now I have not considered my second pillar into it. Why? Because I do not get a monthly report on my second pillar. However, I do not really need this monthly report since I can extrapolate from the yearly results. I just was too lazy before to do it.
So, I decided to stop being lazy and do it. In this post, we are going to see why you should integrate your second pillar into your net worth. And we are going to see how to integrate it. It is very simple. And it will make your net worth calculation much more accurate. I believe it is very important to have an accurate view of your net worth.
If you do not know your net worth, first take a look at how to calculate your net worth. I strongly encourage everybody to compute his net worth. It is an important indicator, especially if you want to become financially independent.
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For the first time, I have computed my Financial Independence (FI) ratio. In this post, I am going to explain to you what is FI and how to compute your FI ratio.
First, what is Financial Independence (FI)?
It is when you have enough money to sustain your lifestyle without working. For this, your wealth must generate income. And this income must be greater than your expenses. The main way to generate income from your wealth is simply to withdraw from it. However, you need to withdraw little enough to sustain your wealth for the longest time. This is only one of the ways to reach Financial Independence. This is the most used way. Some people prefer to focus on passive income. And some people focus entirely on real estate to become financially independent.
There are many reasons to become Financially Independent. It is currently very popular on the internet. Especially with the Financial Independence and Retire Early (FIRE) philosophy. The idea is to become Financially Independent as soon as possible and retire early.
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