Information sheetPension or lump sum at retirement

Pension Fund Swiss Re Mythenquai 50/60

8022 Zurich www.pensionskasse-swissre.ch/en

Pension Fund Swiss Re Mythenquai 50/60 8022 Zurich www.pensionskasse-swissre.ch/en

Information sheet Pension or lump sum at retirement.pdf P a g e | 1

Information sheet "Pension or lump sum at retirement"

Pension or lump sum? Before reaching retirement age, you can elect to receive your retirement benefits from the Pension Fund Swiss Re as a lump sum or a life pension. It is also possible to select a combination of the two, a partial lump sum and a partial life pension with the lump sum making up any proportion from 0% to 100%. If you select a lump sum, you assume responsibility for providing a retirement income for yourself. This means you will be responsible for investing the money. If you opt for a pension instead, the Pension Fund remains responsible for the investment risk. You will need to decide how to withdraw your Pension Fund retirement benefits.

If you do decide to draw a lump sum, you must inform the Pension Fund of this at least two months before your retirement. You will also need to indicate the amount of the lump sum. To inform the Pension Fund, please complete the form "Application for lump-sum payment at retirement".

It is impossible to make a general recommendation for either a pension or a lump sum. It will depend on your personal situation (family and dependents, health) as well as your personal preferences and goals and your income and asset situation.

Pension Lump-sum withdrawal Advantages • Regular income for life

• High interestrate guaranteein theconversion rate

• No capital market risk orlongevity risk

• Survivors' benefits forspouse/cohabitingpartner and orphans

• No need to worry aboutinvesting your money andplanning for liquidity

• Large financial flexibility as capitalcan be accessed at any time

• It may be possible to achieve abetter return through personalmanagement of investments

• In the event of death, the remainingcapital will form part of your estate

• A lump sum can be used to pay off amortgage (partially or in full)

• A lump sum allows for you togive your heirs an advance ontheir inheritance

• It may be possible to achieve a betterinflation adjustment through higherinvestment returns

Disadvantages • If no survivors' benefits arepayable at death, theunused portion of theretirement capital isforfeited to the PensionFund Swiss Re

• The inflation adjustmentdepends on the financialposition of the Pension Fund;as a rule, the is no fulladjustment for inflation

• You and your survivors carry thecapital market risk. Negativeperformance on capital markets canresult in insufficient retirementincome

• You and your survivors carry thelongevity risk. It is possible that thecapital will not last for the fullduration of your lifetime and that ofyour spouse/partner

Taxes • The monthly pensionpayment is fully subject toincome tax

• The lump sum payment is taxed at areduced rate separate to otherincome. The tax rate is determined byyour place of residence, marital statusand the amount of the lump sum.

Pension Fund Swiss Re Mythenquai 50/60 8022 Zurich www.pensionskasse-swissre.ch/en

Information sheet Pension or lump sum at retirement.pdf P a g e | 2

Swiss federal tax: https://www.steueramt.zh.ch/internet/finanzdirektion/ksta/de/steuerberechnung/npers/direkte_bundessteuer_auf_kapitalleistungen.html

Zurich cantonal tax: https://www.steueramt.zh.ch/internet/finanzdirektion/ksta/de/steuerberechnung/npers/staats_und_gemeindesteuern_auf_kapitalleistungen.html

• Once it is paid out, the capital is subject to wealth tax

• Return on the capital is subject to income tax

• Capital gains are exempt from tax (please note: if there is a high investment turnover, the tax authorities may classify this as commercial securities trading)

Reasons for pension or lump sum

• Your AHV and Pension Fund Swiss Re pensions are your only source of income and you have no other assets

• You have no or only limited experience in making investments

• You and your spouse/partner would like a guaranteed monthly income for the rest of your lives

• You have other sources of income in addition to your pension

• You have other assets • You would like to have flexible

and unlimited access to your capital

• You and your spouse/partner have experience in making investments

• You would like to use the capital to pay off your mortgage

• You would like to give your children an advance on their inheritance

• You would like the remaining capital after your death to form part of your estate