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Step 5: How Can I Finance Early Retirement?
If you are aiming to take early retirement, the following information will give you an overview of your options and their effects on your financial situation.
Steps toward Early Retirement
If you take early retirement, your AHV/AVS pension benefits, and, depending on the particular pension fund, your occupational benefits pension will be reduced. To prepare for early retirement as fully as possible, you should take the following steps between your 50th and 55th birthday:
- Discuss the options and time frame for early retirement with your pension fund manager in accordance with the pension fund regulations, and the amount of the early pension payments or any bridging pension granted.
- Make a decision about early AHV/AVS pension payments or financing options for AHV/AVS and IV/AI contributions that are due before you reach normal retirement age.
- Select an investment strategy for assets you have withdrawn from your pension fund. The pension fund must generally be notified about lump-sum payments several years in advance.
- Decide about payment of Pillar 3 retirement assets: Where possible, payments should be made in installments to reduce progressive taxation.
- Select an investment strategy in the case of lump-sum withdrawals.
With the help of our Pension Calculator for Regular Retirement or our Pension Calculator for Early Retirement you can get an initial impression of your personal pension situation. Why not get in touch with us? Our pension advisors will be glad to show you how you can afford to take early retirement.
Optimizing Your Pension Situation for Early Retirement
You can receive your AHV/AVS pension and your pension from the pension fund as soon as you commence early retirement. Your pension fund may offer a so-called bridging pension from when you retire until the legal retirement age. This means that you can leave your AHV/AVS pension untouched and can continue paying AHV/AVS and IV/AI contributions.
Alternatively, you have the option of receiving a portion of the assets from your pension fund or Pillar 3 and using them to cover your living expenses until you reach the legal retirement age. Your remaining retirement assets will be converted to an annuity pension when you reach the legal retirement age.
You now have an overview of the most important steps involved in preparing for your retirement. Our pension advisors will be happy to help you set up your preferred pension solution. We recommend that you contact us in good time.
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