Retirement in Switzerland: What the Government Requires and How to Plan Your Retirement Savings
“Maintain your current standard of living in retirement: by starting to plan for retirement five to ten years earlier.”
Retirement expert
published on
12. May 2026
Key Points at a Glance
Preparing for retirement is a significant life stage that requires addressing legal frameworks early on. While individual preferences shape the planning process, the government sets the decisive framework through laws and reforms. In particular, the AHV 21 reform has brought about significant changes to old-age and survivors’ insurance (AHV) as well as occupational pension plans. For people aged 40 and older, it is therefore important to be familiar with government regulations in order to finalize their own retirement planning in a timely manner.
AHV 21: The new reference age and increased flexibility
With the entry into force of the AHV 21 reform on January 1, 2024, the term “retirement age” was replaced by “reference age.” The reference age defines the point in time from which an insured person can receive their old-age pension without reductions. For both men and women, this target reference age will be uniformly set at 65 years in the future.
The increase in the reference age for women from 64 to 65 will take place gradually starting in 2025. This affects women born in 1961 or later. To mitigate the effects of this change, the government has provided specific compensatory measures for the so-called transitional generation (those born between 1961 and 1969). These women will either receive a lifetime pension supplement if they do not take early retirement, or benefit from reduced reduction rates if they do take early retirement.
More Flexibility in Retirement Transition
The government now allows for significantly more flexible retirement between the ages of 63 and 70. Early retirement is possible starting at age 63, although a limit of 62 applies to women in the transitional generation. Now, the AHV pension can be taken early not just in full years, but down to the month.
In addition, the option of partial pension payments has been introduced. Insured individuals can take between 20% and 80% of their pension early and defer the rest, for example, to finance a gradual transition by reducing their work hours. Those who continue working beyond the reference age can supplement their old-age pension up to the statutory maximum amount through additional contributions.
Tied private pension provision within the state framework
Pillar 3a is enshrined in the Federal Constitution as part of the three-pillar concept and is tax-advantaged by the federal government. The state determines who is eligible to contribute: These are primarily employed persons with an income subject to AHV contributions in Switzerland.
Regarding the withdrawal date, the law stipulates that the balance may be paid out no earlier than five years before reaching the reference age. Deferral is only possible if employment continues beyond the reference age, but only up to the age of 70. Early withdrawal is permitted only in narrowly defined exceptional cases, such as the purchase of residential property, the commencement of self-employment, or permanent departure from Switzerland.
New Opportunities for Contributions
Starting with the 2026 tax year, the government will for the first time allow retroactive contributions to Pillar 3a for individuals who made no contributions or only partial contributions in previous years. These contributions can be made retroactively for up to ten years, provided that income subject to AHV contributions was earned in the relevant year. This offers an additional government-supported opportunity to close pension gaps while simultaneously reducing the tax burden.
Lump Sum or Annuity: Legal Requirements in the 2nd Pillar
In occupational pension plans (pension funds), the government stipulates that insured individuals have the right to withdraw at least 25% of their mandatory retirement savings as a lump sum. Many pension funds also allow the withdrawal of the entire balance, though advance notice periods of up to three years often apply.
The decision between a lifetime annuity and a lump-sum withdrawal is one of the most far-reaching choices made at retirement. While the annuity offers financial security for the rest of one’s life, the lump sum provides greater flexibility and the ability to pass on the assets. From a tax perspective, the lump-sum withdrawal is taxed once at a reduced rate separately from other income; thereafter, however, it is subject to wealth tax.
Conclusion and Recommendations
Government regulations regarding retirement are complex and subject to constant change. Sound retirement planning is essential to make the most of the leeway within legal requirements and avoid serious mistakes. Since many decisions—such as choosing between a pension and a lump-sum payment or the timing of AHV benefits—cannot be reversed later, professional advice is recommended.
How to Plan Your Retirement
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Frequently Asked Questions
When is the earliest I can withdraw funds from Pillar 3a?
Funds from Pillar 3a can generally be withdrawn no earlier than five years before reaching the AHV reference age.
How has AHV 21 changed the retirement age for women?
The reference age for women will be gradually raised from 64 to 65 starting in 2025, beginning with those born in 1961.
Can I take only a portion of my AHV pension early?
Yes, since 2024 it has been possible to take a portion of the AHV pension (between 20% and 80%) early or defer it, which allows for greater flexibility during the transition to retirement.
Are there government regulations regarding the withdrawal of pension fund assets as a lump sum?
By law, every pension fund must allow its members to withdraw at least 25% of their mandatory assets as a lump sum; for higher percentages, the respective fund regulations apply, and advance notice periods of several years are often required.