Contribute to Pillar 3a: process, standing order and timing
The timing of your contribution changes nothing about the tax deduction. For your retirement capital it does. Compando shows the process, the three ways to contribute and the right moment in the year.
1. How do I contribute to Pillar 3a?
A contribution to Pillar 3a goes directly into a 3a account or a securities solution with your provider. With banks and pension apps the process is similar. With an insurance policy the contribution is not freely chosen: the premium is agreed in the contract.
- Open a pension solution: choose an account, a securities solution or a combination with the provider.
- Initiate the contribution: via e-banking, standing order, app or a single transfer. The account number is in the opening document or in the provider's customer area.
- Submit the contribution certificate: the provider issues it after the credit. The document proves the tax deduction and belongs with your tax return.
How much you may contribute follows the maximum contribution and whether you are affiliated to a pension fund. And for the tax deduction to apply this year, the money must be credited with the provider before the contribution deadline.
2. Pillar 3a monthly or yearly: which pays off?
Three ways to contribute are available. For tax purposes it makes no difference whether you contribute monthly or yearly. For planning, discipline and return, the choice matters considerably.
Way to contribute | Advantage | Disadvantage |
|---|---|---|
Monthly standing order | steady, no gaps | little control over the timing |
One payment per year | fully invested at once | high one-off burden |
Flexible contribution | adaptable to your liquidity | easily forgotten |
With a regular income the standing order is the obvious choice. CHF 604 per month add up to CHF 7'248 a year. The remaining CHF 10 up to the maximum contribution of CHF 7'258 you transfer separately at year-end.
With a fluctuating income or in self-employment you are better off contributing flexibly. Your annual income is only certain once the accounts are closed. If you contribute in November or December, you already know the deductible amount and do not transfer too much.
Whether a standing order can be adjusted, paused or topped up with a one-off payment at any time is for each provider to decide.
Checking providers pays off
Which provider suits your way of contributing is shown by the direct comparison of all Swiss 3a solutions by costs and minimum deposit.
3. Does a contribution in January bring more than in December?
Yes. If you contribute in January instead of December, you gain eleven months of additional investment time. The tax deduction stays the same, your final capital does not.
The reason is the compound interest effect: every franc invested earlier works for longer. With a plain 3a account the difference is small, with securities it is considerable.
Example calculation: Anyone who pays in the maximum contribution every January instead of every December for 30 years ends up with around CHF 15'000 more retirement capital with a securities solution at a 4 percent return.
If you would rather not keep the date in mind every year, a standing order achieves almost the same: the contributions flow evenly across the year and therefore on average earlier than a payment in December.
Calculate your possible retirement capital
How strongly the timing of the contribution works over the years is calculated by the wealth calculator based on amount, term and return.
