Vested benefits account: All you need to know at a glance

A vested benefits account is a special account in which employed persons can place their pension assets from their occupational retirement provision securely and with tax benefits if an employment relationship ends but they do not immediately start a new job. This may be the case, for example, due to unemployment, a career break, maternity leave, self-employment or a period of time spent abroad.

The accumulated pension assets from the previous employer's pension fund continue to be invested and earn interest in the vested benefits account. The assets are either transferred to a new pension fund when the holder takes up a new position or remain in the vested benefits account until retirement.

In the Swiss occupational retirement provision system, money is saved in the pension fund for the purposes of retirement provision. When a person changes jobs, these assets are transferred from one pension fund to another. A vested benefits account is opened if this transfer is not possible, perhaps because a new job has not yet been lined up or because there is a lengthy break between the two jobs.

A vested benefits custody account is an interesting alternative to a vested benefits account with a bank. With a vested benefits account, the money is invested at a fixed interest rate, but with a vested benefits custody account, the pension assets are invested in securities and other investment instruments. This offers better potential returns, but the risk and return must be weighed up carefully, so be sure to seek advice from a specialist in order to find your optimal investment strategy.

The vested benefits custody account of the Zurich Invest Vesting Foundation offers a flexible and self-determined way to manage and invest pension assets. It gives you the freedom to choose from different investment strategies according to your individual risk profile and long-term financial goals. There is a wide range of investment forms available, such as shares, bonds and money market instruments, and you can diversify your risk with a clever mix of different asset classes. The expected returns and the fees applying to the vested benefits custody account depend on the chosen investment strategy and investment form. You can arrange a consultation to clarify all unanswered questions and find the best individual strategy.

For customers with pension fund assets of CHF 200,000 or more, the Zurich Invest Vesting Foundation offers the Premium vested benefits solution. This enables higher investment returns through access to more exclusive investment options that potentially offer better yields. Customers also receive individual support and customized investment strategies that are tailored to their specific needs and objectives.

If you start a new job again after a career break or a period of unemployment, it is important to transfer the assets from your vested benefits account or vested benefits custody account to the pension fund of your new employer. In this way, the pension assets can be seamlessly integrated into your new employer's pension system and the continuity of your retirement provision is maintained.

In certain situations, it may be worth having the vested benefits paid out not into one vested benefits account or vested benefits custody account, but into two, a process known as "splitting." This creates greater investment flexibility, the funds can be paid out at different times, and it might also be advantageous from a tax perspective, especially for higher amounts. Here too, it is definitely worth seeking expert advice to find the optimum solution.

https://finpension.ch/de/wissen/wie-sie-die-pensionskasse-splitten-koennen/

Make sure that the vested benefits assets are transferred to the new pension fund on time and in the correct manner – this will ensure that your retirement provision continues seamlessly and that no pension gaps arise.

• Inform your new employer that you have vested benefit assets that need to be transferred. Your new employer will then provide you with the necessary information for the transfer.
• Contact the vested benefits foundation where your vested benefits account or vested benefits custody account is held. Let the foundation know who your new employer is and to which pension fund the assets are to be transferred.
• Complete the necessary forms that you will receive from your vested benefits foundation and the new pension fund.
• Take care of the transfer as soon as you start your new job, as the vested benefits should normally be transferred within a year. In this way, you can also be sure that the vested benefits account or vested benefits custody account is not forgotten.
• As soon as your assets have been transferred, you will receive confirmations from both your vested benefits foundation and the new pension fund. Keep these documents in a safe place.

Many people have set up one or more vested benefits accounts in the course of their career, but are no longer fully aware of this. If you are not sure yourself whether you have a vested benefits account due to a career break, you should definitely check this. Your retirement savings could be in such an account, and it is crucial that you know where your money is and how it is invested so that you can keep track of your retirement provision and are able to continue to achieve your financial goals.

Reviewing existing vested benefits accounts also gives you the opportunity to review your investment strategy. Does it still fit your financial goals and risk profile, or is there potential for optimization? You can also find out how good the conditions of your vested benefits account are. Is there a provider with more favorable fees and conditions? Is your personal information, such as account details and address, up to date so that the payment can proceed smoothly?

If you didn't manage your vested benefits account yourself or if you don't know whether you have one, your pension capital may be deposited with the BVG Substitute Occupational Benefit Institution. It is worth checking this. Further information can be found on the website of the Substitute Occupational Benefit Institution.

Important: All assets from vested benefits accounts or from the Substitute Occupational Benefit Institution must be transferred to the new pension fund as soon as you take up a new job.

• Product information and FAQs: Vested benefits custody account
• Premium vested benefits solution from CHF 200,000
• Substitute Occupational Benefit Institution contactless accounts