Good reasons for switching your vested benefits to frankly 

At the moment, your money isn’t doing much for you in your vested benefits account. This is because interest rates are at a record low. In 1987 they were 7%, but now they are around 0.72% on average (as at July 2023).

What does that mean specifically? Let’s assume you have CHF 200,000 in your vested benefits account, then with an interest rate of 0.40% you will receive just CHF 800 in interest per year. This is without taking inflation into account. Inflation reduces the purchasing power of your money. Over the last 20 years, inflation in Switzerland has averaged around 0.56% per year (Source: BFS Online Calculator, as of June 2023). If this remains the case over the next 20 years, your vested benefits account will not make you anything. 

If your pension assets are invested in securities, you have significantly higher return opportunities. There are three main keys to success:

1. Your money should be invested for a substantial period of time. Find the right product for you with our guide to how to open an account.
2. The investment should be appropriate for your investment horizon and risk profile.
3. The fees should be low, because otherwise they will reduce your return considerably. Even small differences in fees can really add up over a relatively long period of time!
    

How you can save on fees with frankly

Studies show that the total costs for traditional pension products average out at 1.15% per year.

Let’s assume you are a 50-year-old man and you have assets of CHF 1,000,000 in your 2nd pillar, which you don’t have to pay into the pension fund of your new employer in full. This means that you can invest the surplus portion (let’s say CHF 200,000, for example) of your vested benefits up to age 70 and choose an investment product with an equity component of 75%. This means that over the space of 20 years you save CHF 62,400 with frankly compared to similar products on the market, which charge an average of 1.15%.

So if you want to invest your pension assets instead of paying fees, there’s only one solution: switch to frankly as soon as possible.

And the best thing is that frankly doesn’t get more expensive over time, it even gets cheaper! How does this work? With the unique community discount, the prices for everyone go down the more people use it.