Do I still receive a pension if I become unemployed before I retire?

I have worked in Switzerland for many years. I will be turning 65 years old in two years, and plan to retire at that time. My employer has been struggling for some time and they now told me that they will most likely have to lay me off within the next six months. I doubt I will find another job before I reach retirement age.

My question is, will I still receive my pension when I retire, even if I am not employed when I turn 65?

Thank you

Hi there,

When you become unemployed, you must open a vested benefits account and provide your former employer's pension fund (2a) with the account details. The pension fund will transfer your pension savings to your vested benefits account in full. You can use the vested benefits account comparison to compare interest rates.

When you reach the legal age, you can withdraw your pension savings from your vested benefits account. However, you will not receive a pension from a pension fund if you are not employed and participating in the pension fund when you reach legal retirement age.

In your case, because you have reached the legal age required for early retirement, you may be able to retire early ahead of becoming unemployed. If you do this, you will receive a pension rather than having your savings transferred to a vested benefits account. However, your pension is reduced when you retire early.

If you live for many years after retirement, then receiving a pension is beneficial because the pension fund must continue to pay out a pension at a steady rate (a percentage of your pension savings at the time of retirement) for the rest of your life.

Having your savings transferred to a vested benefits account can be beneficial in some cases. For example, obtaining a lump-sum of money which you can invest or use to buy a home, for example, can also be beneficial in some cases. If you die shortly after retiring, then your remaining pension savings may be lost - depending on your family situation and the pension fund's charter.

Important: Although you do not receive an occupational pension (2a) if you are unemployed when you reach retirement age, you still receive a social security pension (1a) based on the contribution which you have made to the social security old-age scheme. Your social security old-age savings cannot be withdrawn or transferred to a vested benefits account. They can only be received as a pension and savings which are not paid out as a pension ahead of your death are kept by the social security scheme.

Best regards from Moneyguru

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