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Glossary

Three-Pillar System

The Three-Pillar System is the Swiss retirement provision model consisting of the state AHV/IV (1st Pillar), occupational pension under BVG (2nd Pillar), and private provision (3rd Pillar). The aim is for the first two pillars together to secure approximately 60 per cent of the last salary (Art. 113 of the Federal Constitution).

At a glance

01

Constitutionally anchored in Art. 111 to 113 of the Federal Constitution; the 1st and 2nd Pillars are compulsory, the 3rd Pillar is voluntary.

02

The 1st and 2nd Pillars together are intended by the legislature to replace around 60 per cent of the last insured salary (benefit objective under BVG).

03

The 3rd Pillar is divided into Tied Pension Provision (Pillar 3a, tax-privileged) and Unrestricted Provision (Pillar 3b).

Frequently asked questions

The model combines three levels: the AHV as state basic provision (pay-as-you-go), the pension fund as employment-linked supplement (funded), and private provision. Only the interaction of all three pillars enables income security in retirement that approximates an accustomed standard of living.

Part of the topic

Vorsorge & Pensionierung

Sources: Bundesamt für Sozialversicherungen (BSV) · Systematische Rechtssammlung (fedlex)