Understanding the 2025 Pillar 3a Maximum Contribution Increase
The Swiss Federal Council has announced new maximum tax deductions for Pillar 3a/3rd Pillar contributions, effective January 1, 2025:
- CHF 7,258 (up from CHF 7,056) for those contributing to a 2nd Pillar
- CHF 36,288 (up from CHF 35,820) for those without a 2nd Pillar
Key Details on 3rd Pillar Contributions and Tax Benefits
For the average worker aged 42 (as of 2021), this change results in an additional CHF 4,646 in retirement savings, and hundreds of francs in extra tax savings, over the next 23 years until they reach 65.
Additionally, those with higher returns on their 3rd Pillar investments will benefit even more. With the new limit of CHF 7,528, the difference between earning 1% and 7% p.a. (average return with 3rd pillars via IWP) could amount to CHF 226,413 by retirement.
Maximize Your 2025 Pillar 3a Savings with Smart Investments
Many people open their Pillar 3a accounts without researching the best options, missing out on the fact that aside from tax savings, there are numerous investment opportunities. These include options like capital protection, customised fund portfolios, or a mix of both.
On average, our clients see additional returns of CHF 226,413 by switching their 3rd Pillar provider. There are typically no fees or penalties for making this switch, even if your current Pillar 3a account is pledged against your Swiss property.
To see how much you could save, contact us for a free consultation to explore your options.