Vested benefits
Vested benefits is the credit FZG (Swiss Federal Law of 17 December 1993 on vesting in occupational old age -, Survivors and Disability Insurance (Vesting Law, FZG)) that every insured person in his pension fund accumulates provided they pay savings contributions.
The savings contributions (retirement credits) are made in a graduated "savings" order (7% / 10% / 15% / 18%) from age 25 to age 64 (women) / 65 (men) in accordance with the BVG (cf. Swiss federal law dated June 25, 1982 on occupational old-age, survivors' and disability benefits) and must be paid at least the statutory minimum interest rate. (Attention: The retirement credits are not to be confused with the contributions which, in addition to the savings contributions, contain risk contributions and administrative costs, etc.)
With most pension funds, the pension benefits (legally these are disability pension, disability child’s pension, retirement pension, retirement capital, spouse’s pension, spouse’s compensation, orphan's pension) are based on the amount of vested benefits . This credit is converted into a pension using the applicable conversion rate - a distinction must be made between mandatory and extra-mandatory credit.
Vested benefits according to the BVG (often also called mandatory credit) mean the part of the available credit that must at least be available according to the legal minimum. Most pension funds have higher savings contributions. This excess portion is called the extra-mandatory portion and is converted when the pension is converted at the regulatory percentage (lower than the statutory rate).
If an insured person leaves the pension fund and has no new job, their vested benefits will be transferred to a vested benefits account with a vested benefits institution .