Finance expert answers the most important questions

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Finance expert Nadia Tonietti from Migros Bank knows what to pay attention to in comprehensive financial planning.

Studies show that Mr. and Mrs. Swiss find it difficult to answer questions about money. Almost every second person rates their knowledge of financial topics as “not good at all”. A need to acquire knowledge, which is also reflected in numerous questions about money topics such as investment, pension schemes and house building on Google – many are dependent on advice.

We wanted to know from Blick readers what the Swiss especially think. The top issue is therefore old-age provision. “Will I have enough money in old age?” is a question that worries more than half of the survey participants. A good quarter of the participants would like to know: “What is the best way to invest my money?”. And at least one eighth deals with the question of how much to save.

These are all questions that Nadia Tonietti from Migros Bank answers below. The financial expert also says what we should pay attention to when we plan our entire finances thoroughly.

Mrs. Tonietti, many Swiss are overwhelmed by financial problems. Why?
Nadia Tonietti: This can be seen, for example, in the fact that many people continue to “park” their money in a savings account, even though it rarely yields interest. This is justified by a lack of knowledge, which is a direct result of the widespread lack of interest: 40 percent of those questioned stated that they were not at all interested in financial and investment topics.

Is it really that complicated?
none Today you can find many good articles on the Internet that simply explain financial topics. A certain basic interest is of course a prerequisite for this. And fortunately, banking experts are available for more complex questions. On the other hand, there is a great deal of ignorance: A lot of Swiss assume, for example, erroneously that it is only possible to invest money with larger assets. In practice, fund savings schemes or rounding off savings via fund accounts are already available for small amounts.

How much wealth is worth investing in funds or shares?
Today, there is hardly a lower limit for investing money. People usually get on with 1000 francs. For smaller amounts, we recommend funds, with a fund savings, for example, you can join from as little as 50 francs a month. Rounding can be done from as little as 1 franc: the daily purchases paid for with the payment card are rounded up to the nearest 1, 5, 10 or 20 francs, and the rounding difference goes into a fund account. But where and how you invest money is ultimately always a matter of type.

Instead, many Swiss simply start saving without a plan. What do you recommend?
The majority of those who are currently saving are really saving without having given much thought to how the savings goal can be reached most effectively. This is especially true of young people without a concrete plan. When saving, it is advisable to divide the money into several “pots”. The first pot is there to cover short-term expenses. The second is a security pool for investments that can be planned, for example for a new car in the next five years. The third pot is a growth pot. Investments are made in wealth building or in pension insurance.

How can you remove people’s fear of investing?
As mentioned, it is important to divide the money into several pools. Money not needed for short-term expenses and planned investments can be invested. There are many investment options, for example funds with a fund savings. Especially the latter are suitable for small investors. Funds have a broader base, price fluctuations are usually better dampened than with individual investments. The strategy is chosen depending on risk tolerance and return expectations. Paying the amounts in stages minimizes the risk of buying the fund at an unfavorable time.

Answers to your money questions

We know that people in different situations want to handle their money and their bank differently. Sometimes it needs to be quick and uncomplicated, sometimes it is important to be heard, understood and advised. We offer people simple and direct access to all banking services, either digital self-service or with personal advice from our staff, whichever you prefer. It is important to us that people with their various financial problems feel that they are in good hands with us. What questions do you have?

We know that people in different situations want to handle their money and their bank differently. Sometimes it needs to be quick and uncomplicated, sometimes it is important to be heard, understood and advised. We offer people simple and direct access to all banking services, either digital self-service or with personal advice from our staff, whichever you prefer. It is important to us that people with their various financial problems feel that they are in good hands with us. What questions do you have?

What questions are you most often confronted with at Migros Bank?
Clients want to fund their life goals, secure their retirement benefits, save on taxes or organize their estate. As the subjects become more and more connected, comprehensive financial advice becomes increasingly important.

How does financial advice work for you?
The comprehensive financial advice at Migros Bank is based on a structured process. First, customers have to do some preparatory work. In preparation for the interview with the financial planning professional, some documents must be provided. This concerns the pension fund certificate, last year’s tax return or a list of assets and current income and expenses. In the discussion, the financial planning expert records the goals and needs as well as the overall financial situation. Based on this, the financial planning expert then makes a target/actual analysis by taking into account different calculation variants. The results are recorded in a financial plan, and concrete proposals are formulated on how the customers’ goals and needs can be achieved, taking into account their financial situation.

What things must be considered in thorough financial planning?
Financial planning deals with all the financial aspects of a private household – from the budget and investments to pension benefits and the associated taxes. The topics are thought up in a network and optimally coordinated with each other, so that the customers’ personal wishes and goals can be realized.

Real estate is considered a safe asset. Many Swiss ask themselves: (from when) can I afford a house?
When customers want to buy a house with support from the bank, we always look at two things. First: the composition and size of the required equity capital. And second: How do the imputed costs compare to your income? This shows whether, for example, a house near the city is an option, or whether it makes sense to look in the countryside or for an owner-occupied flat.

The topic of early retirement is also popular. At what age is it included?
It is at the top of many people’s wish lists. Anyone who wants to take early retirement should be aware that it is always associated with financial losses. The lower limit of the required pension assets depends on the standard of living you want to have after retirement. According to the law, early retirement is possible from the age of 58 at the earliest, the specific minimum age is set by the pension fund in its articles of association. Financial planning experts can calculate whether it is possible in your case.

Isn’t there a lot of potential for frustration here because many people see that they don’t have enough money for early retirement?
Of course, people are reluctant to realize that they don’t have enough money for early retirement. In order to compensate for any financial gaps in good time, the project should be tackled as early as possible, preferably a few years before the planned date of early retirement. At best, gradual partial retirement may offer an alternative.

How can I close pension gaps?
If the financial planning shows a pension gap, those affected have three main measures to improve their pension in good time: the remaining working life, the income in the remaining working years and the savings rate. Concretely, this means that those affected can work longer, also beyond the normal retirement age. Income can be improved by increasing workload or increasing wages. The savings rate is increased by a higher savings share of the household budget and by optimal investment of assets.

Speaking of pillar 3a: Should one have more such accounts?
3a funds are taxed upon payment. The tax bill grows gradually with the amount you withdraw in that year. To reduce this tax progression, the 3a assets should be withdrawn in roughly equal installments to ordinary withdrawals. However, a prerequisite for shifting is that the 3a funds have been distributed over several pension accounts from the start. Partial withdrawals from an account are not possible. It therefore makes sense to open several accounts right from the start (even in the same bank) and to distribute the payments equally.

Your personal golden rule of money?
Make sure to use column 3a! Any person with earned income subject to OASI is entitled to contribute to Pillar 3a up to a certain amount and to deduct this amount from their taxable income. Private provision will continue to be decisive with the upcoming vote on the AHV reform. The earlier you start with it, the better. And it’s never too late for that.

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This post was created by Ringier Brand Studio on behalf of a client. The content is journalistically prepared and meets Ringier’s quality requirements.

Contact: Email Brand Studio

This post was created by Ringier Brand Studio on behalf of a client. The content is journalistically prepared and meets Ringier’s quality requirements.

Contact: Email Brand Studio

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