A pension fund? It is simply a pension scheme, also called a retirement fund. It functions by capitalising, that is, accumulating (while the OASI, as previously explained, is not accumulated but rather directly benefits those currently retired).
You can choose this institution if you are self-employed (except when it comes to special professional fields. However, if you are an employee, you will automatically be affiliated to the pension fund chosen by your employer.
This fund’s role is thus threefold:
- Receiving employee contributions and consolidate them in the form of capital
- Invest this capital in accordance to their asset management regulation (within the bounds of the law)
- Transform this capital into pensions, should you choose this solution for your retirement
Pension funds can be public, semi-private or private. Which is why there are so many in Switzerland, though their number decreases each year. There are currently 2,000 across the country, compared with 18,000 in 1985.
Among them are Publica, BVK (Zurich’s pension fund), CFF’s (Switzerland’s national railway system) pension fund, that of the Swiss Post, the canton of Geneva, the canton of Vaud, UBS, Nestlé, etc.
Now you must be thinking to yourself: “which one is my pension fund?”
It is the one your current employer joined!
Which means that when you change jobs, you also change pension funds. Of course, you will not start over each time. The previous amount will simply be transferred from one pension fund to the other.
Be careful: When I say “the previous amount will simply be transferred from one pension fund to the other” it does not mean that this operation is done automatically! You will have to request it. Or else, your assets will become vested benefits which will be hosted by a substitute scheme only in charge of storing these benefits, unlike a pension fund which uses them optimally.