Why starting young changes everything
The 3rd pillar rewards duration. Thanks to compound interest, money paid in early generates returns that themselves generate returns. Two people paying in the same total amount, but one from age 25 and the other from 40, don't end up with the same capital at retirement: the one who started early can finish with a markedly higher amount, for a smaller monthly effort.
From what age can you open a 3a?
You can open a pillar 3a as soon as you earn an AVS-liable income, generally around age 18 (apprenticeship, first job, declared student job). As long as you contribute to the AVS on earned income, you're eligible for the 3a and its tax deduction. The 3b, meanwhile, has no age or income condition.
How much to pay when starting out?
No need to aim straight for the CHF 7,258 ceiling. What matters is regularity: even CHF 50 to 150 a month builds a habit and starts cutting your taxes. You'll raise the amounts as your salary grows. The action matters more than the sum at first.
Bank or insurance for a young person?
For a young worker whose income and plans change fast, flexibility is often the priority: a bank solution (or a 3a app), with low fees and free contributions, is usually better suited than an insurance contract with fixed premiums. Insurance becomes relevant later, when you have dependants or a mortgage. See our bank or insurance comparison.
Mistakes to avoid
- Waiting until you “can afford it”: every lost year is costly in compound interest.
- Committing to insurance premiums that are too high when your income may vary.
- Leaving your 3a idle in a low-rate account when a long horizon would allow investing in funds.
- Forgetting the tax deduction: as soon as you pay tax, the 3a reduces it.
A telling example
Paying CHF 100 a month from age 25, with a reasonable average return over a long horizon, can lead to far higher capital than the same effort started at 40 — the difference is often counted in tens of thousands of francs. The exact amount depends on return and regularity, but the lesson is constant: time does most of the work.
Our simulator shows the effect of time on your capital in 2 minutes. Starting small, but starting, is the essential thing.
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