Increasing your pension by continuing to work at retirement age
AHV/AVS retirement age is no longer an abrupt transition. People are increasingly working beyond the reference age, whether because they enjoy working or for financial reasons. Today, an estimated 20 percent of 65 to 74-year-olds are still in gainful employment and helping to alleviate the shortage of skilled workers.
You can’t pay into pillar 3a any more if you continue working beyond the age of 65.
MISCONCEPTION
Tax authorities exacerbating shortage of skilled workers
If you continue to work after retirement, you’re often met with a nasty surprise. As earned income and pensions from AHV/AVS and pension fund are added together, progressive taxation hits this income disproportionately, making continuing to work or re-entering the workforce at AHV/AVS age so unattractive that many retirees stop again or cut back significantly.
Stop & Go pension” reduces the tax burden
PensExpert has developed the idea of a “Stop & Go pension” in order to make working in retirement more attractive. If you return to work after retirement age, you can temporarily suspend your current retirement pension with the PensUnit Collective Foundation. In this case, you finance your household budget with your AHV/AVS pension and your earned income. This option reduces the tax burden significantly. What’s more, in addition to the interrupted retirement pension, permanently ceasing gainful employment triggers the payout of an additional pension from the occupational pension scheme at a higher conversion rate.
Political tailwind
The idea of a “Stop & Go pension” is currently enjoying a political tailwind and is expected to be open to all insured persons in the future.
Reasons to re-join your pension fund after reaching the AHV/AVS retirement age
- Additional savings contributions boost retirement benefits. Contributions to pillar 3a are still possible.
- Tax relief due to the deduction options associated with savings contributions.
- The attractiveness of gainful employment at AHV/AVS retirement age is increasing.
- Serves as a practical measure to combat the shortage of skilled workers.
- Eliminates unequal treatment of insured persons who continue to work without interruption on reaching AHV/AVS retirement age and those who return to working life after a break.
Donating your 13th AHV/AVS retirement pension
December 2026 will see the 13th AHV/AVS retirement pension paid out for the first time. This supplementary pension goes to all pensioners, regardless of their financial situation. Beneficiaries who can afford to maintain a good standard of living, even without this 13th AHV/AVS retirement pension, are invited to donate this pension. The “Chance 13” foundation wants to send a political message against this fragmented approach and use the revenues to combat poverty in old age, to support the education and training of children and young people and to promote young entrepreneurship.
