3rd pillar - is the money guaranteed?

[OxygeN]

Hi all.
I was talking with a colleague of mine about 3rd pillar investing and he told me that the money I put into the 3rd pillar (be it a bank account or invested through some VIAC/Finpension or the likes) is guaranteed to remain. He used as an example: if I put every year the maximum possible amount into 3A (let's round it up/down to CHF 7000), after 20 years I will have in any case guaranteed CHF 140'000.- independently of how my money did or was invested into. I don't think this is correct, thus I'm asking here: who's right? And where is any link/reference one can read through it?
TIA.

 

[Baptiste Wicht]

Hi

Your colleague is wrong. If you invest the money, there is no guarantee.

You can check out the FAQ from VIAC for instance. They list the risks properly

 

[Michael]

Hi all.
I was talking with a colleague of mine about 3rd pillar investing and he told me that the money I put into the 3rd pillar (be it a bank account or invested through some VIAC/Finpension or the likes) is guaranteed to remain. He used as an example: if I put every year the maximum possible amount into 3A (let's round it up/down to CHF 7000), after 20 years I will have in any case guaranteed CHF 140'000.- independently of how my money did or was invested into. I don't think this is correct, thus I'm asking here: who's right? And where is any link/reference one can read through it?
TIA.

I think he heard that from the 3a insurances, where you sometimes have a 'guaranteed' value. But this comes at a huge cost (premium you pay for that guarantee basically) so its very very unlikely that you'll do better with such a product than with VIAC & co.

 

[OxygeN]

Hi

Your colleague is wrong. If you invest the money, there is no guarantee.

You can check out the FAQ from VIAC for instance. They list the risks properly

Thanks for the link - you're referring to the section "Risk management of investment strategies", right? What I'm looking for, is an official description of how 3A works. I mean: I do understand that being it a "voluntary" contribution, it is not financially backed up by the government (compared to 1st pillar or compared to a bank account which is guaranteed to be covered up to CHF 100k).
To me it was pretty clear that as soon as I moved away from my 3A "bank account" (where you get low interest rates, but you can't lose money) into an "investing 3A", I will take risk all by myself. OTOH: which institution (bank, broker and the likes) would ever want to give you the guarantee that the money you give them for investing will always be there? That would be against their interests (and against any logic, I'd say).

 

[Baptiste Wicht]

Thanks for the link - you're referring to the section "Risk management of investment strategies", right?

Yes, this lists the risks.

If you want an official description of the sort, you are unlikely to find it. The money in an invested 3a has never been and will never be guaranteed. It's just too obvious for people to write it down. A 3a in cash is a different story because there is some protection.

All 3a providers are warning about the risks of investing.

 

[OxygeN]

To me it is (and always has been) clear that by investing money (whether it's in 3A or not) bears some risk and that nobody can and will guarantee that you'll get out what you put in. Strange that my 10 years older colleagues doesn't know about this...