How are pension fund retirement savings credited interest?

How your retirement savings work for you

The interest credited to your retirement savings is a crucial factor for your future pension. It ensures that your capital gains value over the years and is thus an important building block for your financial future. But how exactly is this interest rate determined?

Mandatory and non-mandatory components: An important distinction

To understand how interest is calculated, it is necessary to distinguish between two parts of your retirement savings:

• The mandatory component (OPA retirement savings): This is the legally required part of your pension provision under the Federal Act on Occupational Retirement, Survivors' and Disability Pension Plans (OPA). The Federal Council sets a minimum interest rate for these savings annually.
• The non-mandatory component: Many pension solutions go beyond the legal minimum. This additional part of your savings is referred to as the non-mandatory component. Here, the pension fund can determine the interest rate itself.

A practical example of interest calculation

The different interest rates for the mandatory and non-mandatory portions directly affect the growth of your savings. The following sample calculation illustrates this:

The overall interest rate: Dependent on investment success and stability

A financially sound pension fund can offer a higher interest rate than the legal minimum. The level of the overall interest rate – for both the mandatory and non-mandatory portions – depends on two key factors:

1. Investment success: The pension assets are invested in the capital market. A positive performance of the investments makes it possible to pass on a higher interest rate.
2. Financial situation: The so-called coverage ratio (the ratio between the available assets and the obligations to the insured persons) indicates how healthy a pension fund is. A solid coverage ratio is the prerequisite for a stable interest rate.

For example, Tellco pk was able to credit retirement savings with an interest rate of 2.25% for the year 2024, while the legal minimum interest rate for the same year was 1.25%.

Check your personal savings now

Would you like to know exactly how your retirement savings are composed and how interest is credited? It's this simple:

1. Log in to your digital pension portal ePlix.
2. Open your personal insurance certificate.
3. There you will find all the details about your retirement savings and the current interest rate.

Do you need help reading the document? On our information page, we explain the insurance certificate in a simple and understandable way. Do you have any further questions? Please feel free to contact us.