Investing vested benefits when starting your own business

Investing vested benefits when starting your own business

For example: Sara, 30, decides to start her own business

Let’s assume you are Sara, 30 years old, and you work as a graphic designer at an advertising agency. After a few years in the profession, you now want to explore new avenues and open your own small graphic design office. As somebody who is self-employed you are no longer insured as a pension fund member, but would like to invest your current assets sensibly. You also decide not to withdraw your pension fund assets for your self-employment, even though this would be legally possible.

Possible investment product: Strong 75 Responsible 

Sara opts for a sustainable, active investment product that contains a high equity component (75%). This equity component exceeds the maximum amount of 50% which applies under the investment regulations for pension fund assets. The investment product is therefore only suitable for pension fund members with a very long investment horizon and a high risk capacity and tolerance. The objectives of the investment product are to achieve long-term capital growth and to generate additional income. In exchange, Sara is willing to accept higher risk. Active investment products are also designed to “beat the market”, i.e. to achieve a better investment performance than the market average.

Provide title

Strong 75 Responsible exceeds BVV2 category limits

To the investment products
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What kind of pension could Sara achieve with frankly by the time she retires?

Estimated pension assets at age 69 or in 39 years: 

Statement of changes in net assets

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Calculation and risk information

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Statement of changes in net assets

If Sara were to leave her money in her vested benefits account, in 39 years’ time and assuming interest rates remain low at 0.15%, she would have CHF 53,010. If she were to save in securities, however, with a hypothetical return of 3.97% per year (net after costs) this could rise to CHF 235,500.

The savings you can make with securities are worth much more than just a few hundred francs. Sara, for example, is 30 years old and is self employed. She makes a one-off payment of CHF 50,000 into her vested benefits account with frankly, and she chooses an investment product with an equity component of 75%.

Calculation and risk information

Let's assume, for example: an equity component of 75% and a hypothetical return per year of 3.97% (net after costs).

The future returns and risks presented here are for illustrative purposes only. Securities savings may fluctuate, the hypothetical return cannot be guaranteed and tax effects are not included in this forecast.

Economic models and statistical methods are used for calculation purposes. The forecast corresponds with the most likely performance, and can be predicted for an investment horizon of up to 10 years. In the event of a longer investment horizon the calculations are continued using the same values, whereby no statements can be made about the probability of the calculated results occurring. In the event of very unfavourable market developments, the performance may be lower than the nominal savings value. The calculated values are net of the frankly all-in fee and are based on an interest rate on the vested benefits account of 0.15%. Please note that inflation and the taxes payable when the balance becomes due are not included in this forecast.

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