Pension audit Switzerland: Real case, CHF 1,900 gap

Key takeaways

• A Swiss family with two incomes, two fully funded pillar 3a accounts and a home faced an uncovered gap of CHF 1,900 per month in the event of the main earner's death – capitalised, around CHF 320,000.

• Their pension fund returned 2.1% p.a., well below the Swiss median of 3.4%, and an available 1e plan was unused.

• Without a marital agreement or will, the surviving spouse would not have become the sole owner of the home – with proper estate structuring, an additional CHF 320,000 could have been allocated to her.

• A pension audit costs a one-off four-figure amount and pays off over decades.

What is a pension audit?

A pension audit is a holistic analysis of a person's or family's financial protection across three areas: risk (death and disability), retirement savings (1st, 2nd, and 3rd pillar plus private assets), and marital and inheritance law. Unlike traditional insurance advice, a pension audit examines how all pension vehicles interact, identifies structural gaps, and delivers a prioritised action plan – independent and free of product sales.

The client case: Markus and Sandra

Markus (44) and Sandra (41) live with their two children (8 and 11) in a townhouse in Lenzburg (AG). He works as a senior project manager in the pharmaceutical industry, she works 60% in a marketing role. Both are employed, both have a pension fund (2nd pillar), and both contribute the annual maximum to pillar 3a. On the surface, an exemplary pension situation.

The starting balance:

• Gross salary Markus: CHF 165,000 | Sandra: CHF 78,000 (60%)

• Pension fund retirement assets Markus: CHF 380,000 | Sandra: CHF 120,000

• Pillar 3a accumulated Markus: CHF 95,000 | Sandra: CHF 42,000

• Securities portfolio: CHF 180,000 (passive ETF strategy via robo-advisor)

• Liquidity: CHF 45,000

• Home: market value CHF 1,400,000, mortgage CHF 950,000

Their brief to us was clear: "We know we should be doing more. But we can't see the full picture."

How large is the coverage gap if the main earner dies?

We modelled Markus's death scenario. The monthly replacement income for Sandra and the children:

• AHV widow's pension (1st pillar): around CHF 1,900

• AHV orphan's pensions (2 children, capped at 60% of the AHV maximum pension of CHF 2,520): around CHF 1,500 combined

• BVG widow's pension (2nd pillar): around CHF 2,200 (60% of the projected retirement pension per regulations)

• BVG orphan's pensions: around CHF 1,400 combined (20% each)

• Existing term life insurance: CHF 200,000 lump sum, equivalent to around CHF 600 per month annuitised over 14 years

Total recurring benefits: around CHF 7,600 per month. Set against this, the family's actual financial need: around CHF 9,500 per month for the first 14 years, until the younger child turns 25. This includes mortgage interest, amortisation, ancillary costs, insurance premiums and education costs.

Monthly coverage gap: around CHF 1,900. Capitalised over the relevant period: around CHF 320,000.

What happens to the mortgage in the event of death?

A point the family hadn't considered: the bank will reassess the affordability of the CHF 950,000 mortgage in the event of death. Sandra's part-time income of CHF 78,000 is insufficient for the standard affordability calculation (5% theoretical interest rate plus 1% maintenance). Three options: increase her workload, make a partial repayment – or sell.

How does disability affect finances?

In the case of Markus's disability, the picture is even less favourable: the IV maximum pension in 2026 is CHF 2,520 per month, the BVG disability pension is around 50% of the insured salary. The gap doesn't last 14 years but until the regular retirement age – 21 years in his case.

Sandra had no own loss-of-earnings coverage beyond statutory minimums. A typical blind spot, because families focus on the main breadwinner. But if Sandra were to be unable to work, immediate costs for external childcare and household management of CHF 4,000 to 6,000 per month would arise.

Why "cheap ETF" isn't a retirement strategy

The Bergers do many things right: both max out pillar 3a (2026 maximum: CHF 7,258), both invest their private assets in a diversified ETF robo-advisor. The problem isn't discipline – it's structure across all pension vehicles. Five findings from the analysis:

Finding 1: The pension fund underperforms. Over five years, his collective foundation returned 2.1% p.a. – well below the Swiss median of 3.4%. The risk premium is 11% above the market average, and the equity allocation is only 28%. Since his employer won't change the foundation, this can't be addressed directly – but it has strategic consequences for the other vehicles.

Finding 2: The 1e plan is unused. His employer offers a 1e pension plan for salary components above CHF 132,300, where Markus could individually choose his investment strategy – including up to 80% equity allocation. The unused tax optimisation through buy-ins to this plan amounts to around CHF 6,000 in annual tax savings.

Finding 3: The pillar 3a accounts are poorly positioned. Both accounts are with their main bank in a pension fund with a TER of 1.10% and a 45% equity allocation. Switching to a modern 3a provider (TER 0.39%, equity allocation up to 99%) reduces total costs by around CHF 1,400 per year. Over 25 years, this equates to a low six-figure difference in final value – through fees alone.

Finding 4: The strategic asset allocation is unbalanced. Weighted across the pension fund, pillar 3a and private assets, the effective equity allocation is 51%. Nominally fine for their risk profile – but the equities are in the wrong place: heavily in taxable private assets, lightly in tax-privileged vehicles. By reallocating (maximising equities in pillar 3a, keeping safer assets in private wealth), the tax burden from dividends and capital gains can be noticeably reduced.

Finding 5: The new 3a buy-in option is unused. Since 1 January 2026, retroactive buy-ins into pillar 3a have been possible – but only for gaps that arose from contribution year 2025 onwards. Sandra hadn't maxed out her 2025 contributions due to a maternity-leave overhang. This gap (around CHF 3,000) can now be paid in retroactively and deducted from taxes.

Who inherits what without a marital agreement and will?

The Bergers live under the default matrimonial regime of participation in acquired property (Errungenschaftsbeteiligung). They have no marital agreement, no inheritance contract, no will, no advance care directive, and no living will.

In the event of Markus's death, the distribution happens in two steps: first the matrimonial law dissolution (Sandra receives half of the marital acquired property), then the inheritance law distribution of the estate.

Following the inheritance law reform of 1 January 2023, the statutory inheritance share for the surviving spouse is 1/2 and for descendants also 1/2 (distributed equally). The forced share for descendants was reduced from 3/4 to 1/2 of their statutory share. This significantly expands the freely disposable portion.

Without a testamentary disposition, Sandra inherits 1/2 of the estate, the children together 1/2 (1/4 each). She would therefore not be the sole owner of the house. Upon reaching the age of majority, the children could claim their inheritance shares. If Sandra were to remarry, the children could potentially assert their forced shares immediately.

With optimised estate structuring – marital agreement with maximum benefit (Meistbegünstigung), inheritance contract with the children to further reduce forced shares, will with a usufruct arrangement on the house – Markus could allocate around CHF 320,000 more to Sandra, without the children being disadvantaged. The substance passes to them after Sandra's death.

There's also the often-forgotten advance care directive (Vorsorgeauftrag): without one, in the event of either spouse's incapacity, the adult protection authority (KESB) decides on asset management and personal care – even if the other spouse is available.

Action plan: How we closed the gaps in practice

Priority 1 – immediate (within 3 months):

• Increase Markus's term life insurance to CHF 500,000 (additional premium around CHF 850 annually)

• Loss-of-earnings insurance for Sandra

• Advance care directive and living will for both spouses

Priority 2 – medium-term (within 6–12 months):

• Activate the 1e plan with Markus's employer

• Transfer both pillar 3a accounts to a cost-efficient securities provider (TER below 0.4%, 99% equity allocation)

• Retroactive 3a contribution for Sandra's 2025 gap

• Reallocate the SAA: shift equities into tax-privileged vehicles

Priority 3 – structural (within 12–18 months):

• Marital agreement with maximum benefit (full assignment of acquired property to the surviving spouse)

• Inheritance contract with the children, once they're of age

• Will with a usufruct arrangement on the home

• Review of partial mortgage amortisation to improve affordability in case of death

Three structural insights from this pension audit

1. Most families are underinsured against the main earner's death. Not because they have too few insurance policies, but because no one has ever concretely calculated the gap.

2. "Cheap ETF" doesn't replace a strategic asset allocation. The question isn't "active or passive", but which asset class belongs in which vehicle.

3. Inheritance law is pension law. Whoever addresses risk and investment professionally but neglects the estate side hasn't finished the job.

A structured pension audit costs a one-off four-figure amount. The returns – avoided gaps, tax savings, lower costs, legal certainty – pay off over decades.

Frequently asked questions about pension audits in Switzerland

How much does a pension audit cost in Switzerland? A professional, independent pension audit in Switzerland typically costs between CHF 990 and CHF 2,500, depending on complexity and provider. The Caveo pension audit for mandate clients costs a flat CHF 890 and includes a written audit report and a 60-minute follow-up session.

How long does a pension audit take? The initial meeting takes 60 minutes, the analysis and preparation of the written report around two weeks, and the discussion in the follow-up session 60 minutes. Overall, expect three to four weeks of total lead time.

What documents are needed for a pension audit? Current pension fund certificate from all employers, the most recent tax return including securities statement, existing marital or inheritance contract (if available), will (if available), overview of existing life and loss-of-earnings insurance, and pillar 3a account statements.

What's the difference between a pension audit and traditional insurance advice? Traditional insurance advice is usually commission-based and product-centric – the advisor earns on policy sales. A pension audit is fee-based, independent of product sales, and reviews the entire picture across all three pillars plus private assets plus inheritance law. It delivers an action plan, not a sales recommendation.

Who benefits from a pension audit? A pension audit is especially valuable for dual-income households with children, homeowners with mortgages, self-employed individuals, people with assets above CHF 500,000, and during life events such as marriage, childbirth, home purchase, inheritance or upcoming retirement.

How often should a pension audit be repeated? An audit report typically remains relevant for three to five years. With major life events (marriage, childbirth, inheritance, job change, home purchase) or relevant legislative changes, an earlier update makes sense.

Note: The case presented is based on a real mandate. Names, industry and detailed figures have been altered to preserve anonymity. All social security figures reflect 2026 levels.