1e Pension plans
What are the benefits?
1e Pension plans are part of non-compulsory occupational pension planning (2nd Pillar). The goal is to make contributions on the portion of a salary over CHF 132'300.- into a 1e collective foundation independent of the foundation that manages the basic 2nd Pillar fund.
It offers a modern way of managing a 2nd Pillar plan. The investment risk is transferred from the pension fund to the employee. Big companies using IFRS or US-GAAP accounting standards can reduce the reserves needed to guarantee 1e plans on their balance sheets. The benefits in the event of disability and death can be different from the basic fund to encourage savings.
Employees can choose the investment strategy depending on their risk profile. Their strategy is thus personal and individual. This offers a lot of flexibility and can be changed at the end of each month. Furthermore, there is greater transparency than with a pension fund since the employee can find out the amount in their 1e plan at any time. They receive the full return depending on the investment performance, whether it be positive or negative.
Tax-deductible top-up contributions can be made in the event of gaps in funding.
The assets built up are paid out in cash when the employee reaches retirement age. This amount is subject to the tax on pensions.
Pictet has decided to partner with finpension 1e Collective Foundation, a recognised 1e occupational pension foundation. The goal of this partnership is to offer the best of both worlds. From an administrative viewpoint, finpension is recognised on the market for having one of the best digital solutions and assisting its clients with a range of skills in the area of pensions. On the investment management side, Pictet offers actively managed and proven pension solutions with ESG-labelled funds.
There are several investment strategies to choose from, each one actively managed by a team of experienced asset managers. Most of the strategies are managed in accordance with sustainable development principles. Most of the assets will be invested in securities whose issuers can be deemed to comply with environmental, social and governance (ESG) criteria.
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Low risk (money market)
Preserve your capital while earning returns equivalent to Money market rates.
LPP Sustainable Multi Asset 10
You seek attractive returns, but wish to limit the risks of fluctuations in your capital. You are willing to accept price fluctuations to a limited extent. The strategic asset allocation in equities is 10%.
LPP Sustainable Multi Asset 25
You wish to diversify your investments and are willing to bear greater price fluctuations. You are prepared to take on increased risk in the expectation of higher returns than the previous strategies. The strategic asset allocation in equities is 25%.
LPP Sustainable Multi Asset 40
You wish to invest your capital in such a way as to obtain the highest possible performance, with due regard to the risks incurred. You can bear all the price fluctuations throughout the duration of the investment. The strategic asset allocation in equities is 40%.
LPP Multi Asset Flexible
You seek to earn an absolute return in all market conditions through diversification and greater flexibility in asset allocation, whilst following strict risk management. You do not want to invest only in traditional asset classes and are willing to accept price fluctuations, but to a limited degree.
LPP Sustainable Multi Asset 60
You seek to maximise returns and are willing to take on significant risk, while being able to bear all price fluctuations throughout the duration of the investment. The strategic asset allocation inequities is 60%.
LPP Multi Asset 80
Assets are allocated across two funds: 50% in the LPP Sustainable Multi Asset 60 (see above) and 50% in the Swiss Equities Tracker. The strategic asset allocation in equities amounts to 80%.