Wages in Switzerland are high, but so is the cost of living. A high cost of living means that retired people are typically at a disadvantage. However, the Swiss pension system compensates for this with the use of its three pillar system. The first pillar is the compulsory state pension, the second is the 50/50 employer contributed pension, and the third pillar is the tax incentivised Swiss pension system. The Swiss Pillar system, along with their fringe benefits, are the reasons why the Swiss pension system is one of the most robust in the world.
A QROPS (Qualifying Recognised Overseas Pension Scheme) has many benefits, but one of the most commonly cited reasons for paying into a QROPS is that the pension doesn't die with the retired person. QROPS is one of a very small minority of HRMC (UK) recognised schemes where whatever money is left over is given to the retired person's loved ones. A Qualifying Recognised Overseas Pension Scheme is an overseas pension scheme that is capable of accepting a transfer value from a UK-registered pension scheme. People who have built pension funds in the UK, and who are planning to live outside the UK permanently, will benefit the most from this type of pension transfer pension scheme.
Swiss pillar 3a is a category of private retirement savings with a tax privilege. Your contributions are tax deductible, and a 3a Pillar Swiss pension scheme has the most tax benefits compared with other retirement schemes. The reason for this is because it is very difficult to remove your money from your 3A savings, whereas it is slightly easier to remove money from things such as your 3b pillar plan.
In today’s unpredictable world, making sure your retirement income matches your lifestyle plans is of paramount importance. From 1970 to the present day, the average lifespan in the UK has increased nearly ten years, to just under 81 years of age. With improved health care, people are also more physically active in their senior years than they were 50 years ago. Having worked hard for 50 plus years, it makes good sense to analyse your financial planning to ensure your pension income can provide for everything you’ve promised yourself. After all, age is but a number. Here are seven ideas worth considering to help make your pension more secure.
It is assumed by many successful business owners and corporate high-flyers that they have little to be concerned about when it comes to financial planning for retirement. Pension plans have been put in place that should, according to projections, provide a retiring income commensurate with final salaries. With large financial commitments such as mortgages paid off, the assumption is that they will have greater disposable income to enjoy. The truth though, according to research carried out by HM Treasury, is that only 22% of soon to be retirees have any real idea of the value of their pension pots.
A self-invested personal pension (or a SIPP for ease) is a scheme that takes full advantage of the new pension freedoms in the UK. It’s a scheme that provides flexibility in regards to what you can do with your investments, and as such, is a great option for those who don’t want to succumb to the rigidity of traditional scenes that limit you to buying a fixed income with your pension pot.
1. SIPPs are incredibly tax-efficient
When investing through a company pension scheme, your contributions are made prior to your income being taxed. However, with a SIPP your contributions will be made after your income has been taxed. The SIPP provider will automatically claim the basic rate of 20% and add it to your pension pot. This means that if you contribute £80 into your SIPP, a total of £100 will be invested.
Here, we review Qualifying Recognised Overseas Pension Schemes, a flexible type of retirement savings plan that offers advantages to British expats. If you are a pension investor based in mainland Europe, especially Switzerland, Denmark, Sweden, the Netherlands, and France, read on to discover the benefits that an overseas pension could provide.