Vested benefits: what happens to your Swiss pension fund (2nd pillar) when you change jobs?

Compulsory insurance ends when the employment relationship is dissolved (art. 10 para. 2 LOB). For one more month, you remain insured with the old fund for the risks of death and disability; if you join a new fund in the meantime, the new fund is responsible (art. 10 para. 3 LOB). Retirement savings do not continue: no more credits are added until the assets are in a new fund.

Anyone who leaves their fund before an insured event, that is before retirement, disability or death, is entitled to a termination benefit, also called a vested benefit (art. 2 para. 1 Vested Benefits Act). It falls due on the day you leave and earns interest from that moment at the LOB minimum rate (art. 2 para. 3 Vested Benefits Act; art. 15 para. 2 LOB), i.e. 1.25% in 2026.

Under the defined contribution system used by the large majority of funds, your entitlement is the savings capital: all employer and employee contributions credited for retirement, with interest, plus any buy-ins (art. 15 Vested Benefits Act). Under a defined benefit system, it is the present value of the accrued benefits (art. 16). In every case you receive at least the entry benefits you brought with you plus interest, plus your own contributions increased by 4% per year of age from age 20, up to 100% (art. 17). The fund’s regulations may provide more, never less (art. 2 para. 2).

The fund must draw up a statement of the termination benefit showing how it was calculated, the legal minimum and the compulsory LOB retirement savings share (art. 8 para. 1 Vested Benefits Act). It must also tell you every option for maintaining your pension cover, including for death and disability (art. 8 para. 2). Keep this statement: it separates the compulsory and extra-mandatory parts, and that distinction matters if you move abroad.

Once it has received all the necessary information, the fund has thirty days to transfer the benefit; after that it owes default interest (art. 2 para. 4 Vested Benefits Act), set at the LOB minimum rate plus 1% (art. 7 Vested Benefits Ordinance), i.e. 2.25% in 2026. The start of this period is in your hands: as long as you have not named a destination, it does not run.

It must immediately give the fund the address, or failing that the AHV number, of the employee whose contract has been terminated, and state whether the termination results from a health impairment (art. 1 para. 1 Vested Benefits Ordinance). For your part, you tell the fund where to transfer the benefit (art. 1 para. 2). If you leave at the end of your notice period without having signed elsewhere, the choice stays open, but the law requires you to make one.

If you join a new pension fund, the old one must pay the termination benefit to it (art. 3 para. 1 Vested Benefits Act). This is not a choice: you cannot leave part of the savings in a vested benefits account to withdraw later. If you had opened a vested benefits account in the meantime, the institution managing it pays the capital to the new fund, and you must report your entry to the one and the name of the other to the other (art. 4 para. 2bis). More than 540 pension funds were using the BVG Exchange platform for these transfers at the end of 2025, according to the Substitute Institution’s 2025 report, but the notification remains your job. You then come under the new fund’s regulations: entry threshold of 22,680 francs of annual salary, coordinated salary between 26,460 and 90,720 francs (art. 2 and 8 LOB), employer share at least equal to the sum of employee contributions (art. 66 LOB); our guide to the Swiss payslip explains how to read the LOB line.

A break, training, unemployment, self-employment, a move abroad pending clarification: if you do not join another fund, you must notify the old one of the admitted form in which you are maintaining your pension cover (art. 4 para. 1 Vested Benefits Act). The admitted forms are a vested benefits policy with an insurer and a vested benefits account with a bank foundation (art. 10 Vested Benefits Ordinance). The benefit may be split between two vested benefits institutions at most, and you may change institution at any time (art. 12). In a pure savings account, the capital is the benefit paid in plus interest (art. 13 para. 5), at a rate set by the foundation with no legal minimum; in a securities account, it is the value of the investments. Compare fees and rates before signing: nothing obliges you to use the former employer’s bank.

Without notification, the fund pays the termination benefit, with interest, to the LOB Substitute Occupational Benefit Institution, at the earliest six months and at the latest two years after the vested benefits event (art. 4 para. 2 Vested Benefits Act; art. 60 para. 5 LOB). The money is not lost, but it sleeps: the foundation managed 1,604,509 vested benefits accounts at the end of 2025, worth 20.98 billion francs, paying 0.1% interest in November and December 2025 against a 1.25% minimum rate in a pension fund (annual report 2025). You can request a transfer to your new fund at any time.

Recipients of unemployment insurance daily allowances are compulsorily insured for the risks of death and disability with the Substitute Institution (art. 2 para. 3 and art. 60 para. 2 let. e LOB), with a contribution deducted from the allowances. The retirement savings wait in a vested benefits account. Our guide to unemployment after resigning covers registration with the RAV and waiting periods.

An insured person who, after age 58, ceases to be insured because the employer terminated the contract may require that their insurance be maintained with the same fund, to the same extent as before (art. 47a LOB). They then pay the risk and administration contributions and, if they wish, the savings contributions; the termination benefit stays in the fund and they keep the collective’s conversion rate. The regulations may open this option from age 55 (art. 47a para. 7). Our guide to finding a job after 50 discusses it. Outside this case, a person no longer subject to compulsory insurance may also maintain their cover, to the same extent, with the same fund if the regulations allow or with the Substitute Institution (art. 47 LOB).

You may demand payment of the termination benefit in cash if you leave Switzerland for good, if you become self-employed and are no longer subject to compulsory occupational pension insurance, or if the benefit is lower than your annual contributions (art. 5 para. 1 Vested Benefits Act). If you are married or in a registered partnership, the written consent of your spouse or partner is required (art. 5 para. 2). Moving to an EU or EFTA country carries a restriction, described next.

If you continue to be compulsorily insured for old age, death and disability under the legislation of an EU member state, Iceland or Norway, or if you live in Liechtenstein, you cannot receive the compulsory LOB retirement savings in cash (art. 25f Vested Benefits Act). Only the extra-mandatory part may be paid out; the rest goes into a vested benefits account or policy until retirement. The Guarantee Fund’s Liaison Office determines whether you are insured abroad: it received 11,384 requests in 2025 (annual report 2025). For a move outside the EU and EFTA, the whole amount may be paid out.

Up to three years before retirement benefits become due, you may obtain an early withdrawal for a home for your own use (art. 30c para. 1 LOB): up to age 50, the whole vested benefit; after 50, at most the benefit accrued at age 50 or half the current benefit (art. 30c para. 2). The withdrawal reduces your pension benefits (art. 30c para. 4) and must be repaid if the home is sold (art. 30d para. 1). A vested benefits account allows the same withdrawal (art. 13 para. 2 Vested Benefits Ordinance).

On divorce, termination benefits and pension shares are divided under art. 122 to 124e of the Civil Code (art. 22 Vested Benefits Act). For each spouse, the benefit to be divided is the difference between the termination benefit, including vested benefits assets, on the day proceedings are filed and the one that existed at the time of marriage (art. 22a para. 1). That is why funds must record the termination benefit on the wedding day and at age 50 (art. 2 Vested Benefits Ordinance): keep those certificates.

Retirement benefits from a vested benefits account or policy may be paid at the earliest five years before the reference age and fall due at that age; if you prove you are still working, you may defer them up to five years after (art. 16 para. 1 Vested Benefits Ordinance). A lump-sum payment to a married person requires the spouse’s written consent (art. 16 para. 3).

As long as the savings remain within the pension system (new fund, vested benefits account or policy, Substitute Institution), there is no income to declare and no tax to pay. Tax applies to the benefits you receive (art. 22 Federal Direct Tax Act): a lump-sum payment is taxed separately from your other income, at a rate equal to one fifth of the ordinary scale, without social deductions (art. 38), plus cantonal and communal tax depending on the canton. If you are domiciled abroad at the time of payment, tax is withheld at source by the canton of the institution, at the same reduced rate for a lump sum (art. 96); some double taxation agreements then allow you to reclaim it. A cash withdrawal is therefore a tax decision as much as a pension one.

The 2nd Pillar Central Office, run by the LOB Guarantee Fund, is the liaison body between pension funds, vested benefits institutions and insured persons; it receives requests from insured persons about their assets and gives them the information they need (art. 24d Vested Benefits Act). The request is made by form, online or by post, and is free. In 2025, the Central Office handled 190,000 requests and found at least one asset in 78% of cases, attributing 269,000 assets (annual report 2025). It does not manage the money: it names the institution, which you then contact.

Every year, pension funds and vested benefits institutions report to the Central Office, for the month of December, the people for whom they manage an asset; they also flag those they can no longer reach (art. 24a Vested Benefits Act; art. 19c para. 3 Vested Benefits Ordinance). In December 2024, 1,387 institutions reported 8.4 million people with an asset (annual report 2025). The Central Office tells any insured person who asks which institutions have reported an asset in their name (art. 19d).

Assets with lost contact are those of people the institution can no longer reach (art. 19c para. 2 Vested Benefits Ordinance), typically after an unreported move. The Substitute Institution manages this type of account under a dedicated heading. A simple change of address sent to every institution holding an asset avoids the problem.

Vested benefits assets unclaimed ten years after the reference age are transferred to the LOB Guarantee Fund, which uses them to finance the Central Office (art. 41 para. 3 LOB). The Fund nevertheless meets any claim proven by the insured person or their heirs (art. 41 para. 5): at the end of 2025 it managed 45,475 forgotten assets worth 313.4 million francs and paid out 1,868 of them during the year, 12.9 million francs (annual report 2025). Claims lapse when the insured person is or would have been 100 years old (art. 41 para. 6). The Central Office keeps the data until the person turns 80 (art. 24f Vested Benefits Act).

On the death of the insured person, the Central Office informs the beneficiaries about the institutions that have reported an asset in their name (art. 19d para. 2 Vested Benefits Ordinance). Death benefits from a vested benefits account go to the beneficiaries designated by the ordinance (art. 15): first the spouse or registered partner and the orphans, then dependants or a cohabiting partner of at least five years, then other children, parents, brothers and sisters, and finally the other legal heirs.

Ask the old fund for the latest annual certificate and the termination benefit statement (art. 8 Vested Benefits Act), which shows the total, the compulsory LOB share, the legal minimum and, if you are married, the benefit on your wedding day (art. 2 Vested Benefits Ordinance). Check that buy-ins and the last months’ contributions appear. It is also the time to write your resignation letter if you have not done so.

As soon as you know your new fund, send its payment details to the old one (art. 1 para. 2 Vested Benefits Ordinance): the new fund usually gives you a transfer form for this. Without a new employer, open a vested benefits account or policy and pass on its details (art. 4 para. 1 Vested Benefits Act). Do not let the six months run after which the fund may send the savings to the Substitute Institution (art. 4 para. 2).

The fund has thirty days from receiving your instructions to transfer (art. 2 para. 4 Vested Benefits Act). Ask the new institution for confirmation that the capital has arrived and compare the amount with the termination statement, interest included: any delay entitles you to 2.25% default interest in 2026 (art. 7 Vested Benefits Ordinance).

The same salary does not buy the same pension everywhere: employer share above the art. 66 LOB minimum, coordination deduction adjusted for part-time work, interest credited, buy-in options, choice of pension plan. If the new fund offers higher benefits, your termination benefit is credited as an entry benefit and a buy-in can close the gap (art. 9 Vested Benefits Act). For a part-time position, our guide to part-time jobs explains the effect of the coordination deduction.

File the termination statement, the entry confirmation and the first certificate from the new fund. Every time you move, inform every institution holding an asset in your name. And once a year, if you have had several employers, a free request to the 2nd Pillar Central Office confirms that no asset has gone astray (art. 24d Vested Benefits Act).

Gross annual salary, working hours, location, remote work, contract type: these conditions are in your profile and feed our job market barometer. A recruiter who contacts you has read them.

One candidate in five is employed and on standby: they do not apply, but they receive proposals that meet their conditions. That is the profile that changes jobs when the position is worth it, not under pressure.

Two offers at the same salary are not worth the same if one funds 60% of LOB contributions and the other 50%, or if one waives the coordination deduction. Ask for the pension regulations with the contract: they are part of your pay, and you will know where your vested benefit is going to land.