Accessing your 2nd pillar: Annuity or lump sum? An irreversible decision
When you reach retirement age, you face a major choice: receiving your 2nd pillar (LPP) as a monthly annuity, as a one-time lump sum, or as a combination of both (if your pension fund allows it).
This decision depends on your health, your projects, your finances, and your financial management skills. There is no universally “right” or “wrong” answer, but once the choice is made, it cannot be reversed. At FBKConseils, we help you evaluate all your options and make the decision best suited to your situation.
Why choose FBKConseils for your annuity or lump sum decision?
At FBKConseils, our entire team is highly qualified, trained, and passionate, with expertise across multiple areas to support you throughout your journey.
Expertise in pension and retirement planning
We have in-depth knowledge of the Swiss retirement system (AVS, LPP, 3rd pillar). This allows us to provide you with a comprehensive and coherent vision of your retirement, integrating your other sources of income and life projects.
Accurate tax and financial simulations
The taxation of a lump sum versus an annuity differs significantly. We carry out detailed comparisons, taking into account your canton, your debts, and your family situation, in order to minimize your tax burden and optimize your standard of living.
Personalized guidance for an irreversible choice
Annuity, lump sum, or a mix, each option has major financial and personal implications. We build different scenarios with you so that your decision is based on clear, realistic data.
A human, transparent, and complete approach
We understand that this decision can be stressful. Our role is to simplify the process, explain each step in plain language, and guide you all the way through to the effective implementation of your choice.
Our offers to prepare your annuity or lump sum decision
With us, everything usually begins with a free introductory meeting, either at our office or via video call, to discuss your needs and guide you towards the best possible solution.
0.-
Includes:
- 15-minute introductory consultation.
- First insights into possible options (annuity, lump sum, mixed).
- Answers to your initial questions.
- No commitment.
195.-
/hour
Includes:
- 15-minute introductory consultation.
- Collection and review of your documents (LPP certificate, pension fund regulations).
- Detailed tax and budget simulations with annuity / lump sum / mix comparison and personalized projections.
- Preparation and follow-up of your request with your pension fund.
They already trust us.
At retirement (or up to 5 years earlier if your pension fund allows), you can request your pension fund to pay a monthly annuity. It will be taxed annually as income but will not increase your wealth tax.
You can request the full lump sum payment, which is subject to a one-time specific tax. Once paid, this amount is no longer taxed as income, but it will be added to your assets and increase your wealth tax.
Yes and no, some pension funds allow you to receive part as an annuity and part as a lump sum, though this is becoming increasingly rare. In this case, you combine the security of a regular income with the flexibility of a lump sum.
The 2nd pillar is not only for retirement. It also provides:
A disability annuity if there is at least a 40% loss of earning capacity.
A survivor’s annuity (approx. 60% of the deceased’s annuity).
An orphan’s annuity for children under 18, or under 25 if still in education.
Annuity: taxed annually as income.
Lump sum: taxed once at withdrawal (with reduced tax rates), then added to your assets.
Mixed: a combination of both tax regimes.
Find more articles on this topic.
What tax will you pay when withdrawing your 2nd pillar in Switzerland?
Reading time 6 min. Updated on January, 8th 2025.
Withdrawing the LPP: as a pension or as capital?
Reading time 4 min. Updated on January 7th, 2025.