A study by UBS has found that further increases in the retirement age will be necessary to keep pensions in Switzerland afloat. The Swiss bank predicted that the retirement age will need to be increased by more than three years in the next 50 in order to sustain the AHV and social security system as it functions today.

Pension system in Switzerland will not survive next 50 years, experts claim

The study, which was reported in 20 Minuten, found that if no structural or funding changes are made to the pension system in Switzerland - where employees contribute a portion of their salary to their pension, which is then topped up by employers - the system will run out of money in the next 50 years. They predicted that a significant proportion of society will be claiming pensions soon, and there won't be enough workers to fund the system.

Experts argued that recent reforms, like the referendum to raise the retirement age for women, will “not be enough” to solve the funding problem. "That's why it makes sense to tackle reforms today", the study stated, predicting that life expectancy will continue to rise while the number of people born in Switzerland declines. 

Experts propose higher retirement age and flexible working in Switzerland

To fix the funding issue, the study proposed raising the retirement age in Switzerland from 65 to 68,2 years by 2070. Experts explained that this is the only way to keep pension funds solvent without reducing benefits or increasing contributions.

However, the study argued that while the age of retirement should increase, pension payments should be made more flexible. For example, it proposed offering lower pension payments to those that retire early and “more attractive pensions” to those who work beyond the retirement age. 

In justifying the plan, the study noted, “Work is often negatively connoted. However, it is forgotten that it does not have to be harmful to health, especially at a time when more and more professions are less physically demanding by historical standards." "Working is not a bad thing”, it concluded.