Switzerland’s retirement income system comprises an earnings-related public pension with a minimum pension; a mandatory occupational pension system where the contribution rates increase with age; and voluntary pension plans which are offered by insurance companies and authorised banking foundations.
The overall index value for the Swiss system could be increased by:
- Introducing a requirement that part of the retirement benefit must be taken as an income stream
- Reversing the preferential tax treatment of lump sum payments in comparison to pension payments
- Increasing the state pension age over time
- Increasing the rate of home ownership
- Reducing pre-retirement leakage by further limiting access to funds before retirement
The Swiss index value decreased from 74.2 in 2015 to 68.6 in 2016 primarily due to a reduction in the net replacement rate.