The third pillar is divided into pillar 3a and pillar 3b

Structure of the third pillar

Pillar 3a – the restricted pension plan

Pillar 3a –
the restricted pension plan

Investing and saving with pillar 3a is also referred to as restricted pension planning because the corresponding contracts with banks and/or insurance companies are binding. Regular contributions are made into the bank account or life insurance plan. This money is no longer at the investor's free disposal afterwards. Only in a few exceptional cases may the savings be accessed before retirement, for example to pay off a mortgage. However, the main reason for investing in a pillar 3a product is the tax benefits offered by the government in order to support private pensions. You can deduct all pillar 3a contributions from your taxable income when you complete your annual tax return. While it is true that your pension income is taxed once you start drawing it, this does not outweigh the overall tax advantages.

Pillar 3b – additional pension

Pillar 3b –
additional pension

If you have already invested in pillar 3a and paid in the maximum tax-deductible contribution, you can still set aside more money for your retirement. This is possible with the so-called pillar 3b, where savings are not tied to fixed contracts or forms of investment. On the other hand, pillar 3b does not offer any tax advantages. Many retirement planning solutions in this pillar are very flexible and may be changed or terminated regularly.

Looking for the ideal pension solution? We can help!

Is your pension sufficient for maintaining your standard of living after retirement? Do you also want to provide financial protection for your family, while saving on tax each year at the same time? There is a vast array of pension products to choose from. To find the solution that most closely matches your needs, you need to obtain a detailed analysis of your financial situation. A pension specialist from our partner service Optimatis can advise you free of charge and with no obligation. With the work done for you, you are free to make up your mind in your own time.