Calculating your pension shortfall in Switzerland: here’s how

2. What costs do state and occupational pensions cover?

The Federal Constitution states: «Pensions from the OASI must adequately cover adequately cover the cost of living» (Art. 112 BV). The state pension (first pillar) – combined with occupational pensions (second pillar) – should ensure «the continuation of the accustomed standard of living in an appropriate manner» (Art. 113 BV).

In reality, the OASI pension often does not cover living expenses. That is why the Supplementary Benefits Act came into force on 1 January 1966. Supplementary Benefits Act.

The current occupational pension system was introduced in 1985. But this still does not mean that the usual standard of living after retirement is guaranteed in most cases. That is why the Supplementary Benefits Act, originally intended only as a temporary solution, still exists today.

3. What does a pension gap mean?

The pension gap is the difference between the costs of maintaining your usual standard of living and the benefits from OASI and occupational pensions. You can close this pension gap by depositing private savings into the 3rd pillar . 

4. How much money do I need at a minimum in retirement?

For the calculation of supplementary benefits the AHV assumes a basic requirement of 20,670 francs for individuals and 31,005 francs for married couples. In addition, there are location-dependent costs for rent and healthcare.

However, the minimum AHV pension for single people is only 15,120 francs, and 31,005 francs per year for married couples (as of 2026).

5. How much money do I need to maintain my usual standard of living?

Originally, legislators assumed that the AHV and occupational pension 60% of the last earned income would reach 60% of the last earned income and thus maintain the standard of living. In reality, this is often too little.

As a rule of thumb, you need 80% of your last income, to maintain your usual standard of living after retirement.

6. How does retirement affect saving behaviour?

Retirement has the greatest impact on the savings portion from. According to the Federal Statistical Office single people under the age of 65 save an average of 15.2% of their gross income; couples save as much as 24.2% (as of 2024).

After 65, the percentage saved by individual households drops into negative territory. For couples aged 65 and over, it still amounts to 3.9% of gross income. People over 65 also often have fewer expenses related to eating out, transport and housing.

7. What costs increase after retirement?

The healthcare costs are higher in old age. Tax savings after retirement are rather low despite a lower pension income. This is because, as a pensioner, you can no longer make occupational deductions or pay into pillar 3a.