Important in your family budget: saving for emergencies and retirement

Feb 18, 2022.

What are you saving for as a family? Most families prioritise short-term savings goals, like holidays or a new car. And they tend to put off issues such as retirement provision and risk protection. But these two items should actually have top priority in your family budget. Because life-altering events can bring you to the edge of poverty in an instant. The same can happen in old age if there are gaps in your pension provisioning. Our expert Guido Studier talks about long-term savings goals and how to integrate them into the family budget.

If money is tight, get your priorities right: cover risks first, then old age

With good planning, you can protect yourself financially to cope with risks. This is possible even on a low income. Your next priority should be to make provisions for your retirement. Important: insurance cover for accidents and illness and saving for your old age should be fixed costs in your budget. Once the main risks are covered and your retirement financing has been clarified, you can focus on short-term savings goals and put what’s left at the end of the month towards family holidays or a new car with a clear conscience.


Priority list: getting your priorities in the right order will give you security 

  1. 1. Protection of parents

  2. Normally, parents share the tasks of earning an income for their family and looking after their children. An accident or illness can have a big impact on both these responsibilities. This is even more true for single parents. It is important to check how well you are covered if one of you can no longer work, becomes disabled or dies. You can find this information in your BVG pension certificate, which you receive annually from your pension fund, and in any private insurance policies you may have (loss of earning capacity or death benefits insurance).


  1. 2. Protection of children

  2. If your child has an accident or gets sick, this can radically affect your everyday family life. Such events often result in high costs, and at the same time household income declines because one parent has to spend more time looking after the child. Find out how you are covered in this kind of situation. 


  1. 3. Parents’ retirement provision

  2. Next, you should address your retirement provision. How much money will you have after you retire? Order a summary of your individual account (“IK extract”) from the compensation office in your canton of residence or of your employer. This is the basis for calculating your old-age, survivor’s and disability pension entitlement. Also check your BVG pension certificate, which you receive annually from your pension fund. If you have a pillar 3a, qualified provident insurance or life insurance with a savings component in voluntary 3b provident insurance, then you should also include this private pension provision in your calculations.


These tips are a general starting point, but every situation is different. Get individual advice from an expert.


In practice: how to apply these tips to your family budget

Let’s look at how these three tips can benefit a family. Taking the Mustermann family as an example, we will show you the costs you can expect to incur for insurance cover and retirement provision. Financially the Mustermanns are an average Swiss family, according to the Federal Statistical Office:



You can find the cantonal child allowances here as a PDF. (AHV/IV)


  1. 1. Protection of parents

If Petra or André can no longer work due to an accident or illness, insurance will pay part of their missing income. However, the Mustermann family should also take out private insurance so that they can maintain their standard of living after such an event. This is possible at only a small monthly cost:



The Mustermann family can cover the two most common risks for as little as CHF 100 per person per month. In these exceptional situations, the Mustermanns would be able to concentrate on the essentials and not have to struggle to pay their rent, mortgage, car or domestic help.


Generali tip: You can take out risk protection through pillar 3a, so you benefit additionally from a tax break.


Generali tip: Illness is the most common cause of disability (80% of all cases). Yet illness is covered much more poorly than the risk of an accident. Our guide «Protecting your family» shows you how you can close these gaps and also offers further tips.


  1. 2. Protection of children

Petra and André Mustermann want to protect their children from later loss of earning capacity. This kind of insurance provision also lets you save for your children’s future. Good coverage, such as the KIDS insurance plan for children, would enable the Mustermanns’ son, Tobi, to lead an independent life from the age of 18 if he was unable work due to an accident. If Tobi reaches the age of 18 without needing this insurance cover, he can use the money saved as starting capital for his adult life.


Generali tip: Take half of your child allowances and use them to pay for your child’s monthly insurance cover. There is no better way to invest the money.



  1. 3. Parents’ retirement provision

Every second person in Switzerland worries about their retirement provision. Rightly so, because pillars 1 and 2 are changing considerably. For example, the declining conversion rates applied in pension funds are a key factor.  For you as a saver, this means that you will receive less and less money as you get older. It is therefore all the more important that you take your retirement provision into your own hands by concluding a private pension.


Saving for retirement is often difficult for families because a lot of their money goes to cover their everyday needs and other savings goals. But, even small amounts saved can grow into large sums thanks to compound interest. Saving for old age is particularly worthwhile when you’re younger – anything is better than nothing.



Further advantages of private pensions

There are many different, sometimes complex, solutions for private provision – both through banks and insurance companies. Both types of provider have their advantages and disadvantages. Our flexible pillar 3a offers the best of both worlds:

  • Lower taxes: You can deduct the entire savings contribution that you put into your pillar 3 account from your taxable income. Depending on the tax rate, this will save you up to CHF 40,000 within 30 years.
  • Your insurance will save for you: We will pay up to CHF 3,000 into your pillar 3a every year if you become unable to work due to disability.
  • Stay flexible: If you are struggling financially, you can reduce your pillar 3a deposit.


Families often end up with pension gaps. Because if you look after your family at home and are not employed, you won’t have your own pension fund. If you work part-time or leave your job after giving birth, this can also cause pension gaps. To obtain more information on how to close these pension gaps with a pillar 3a account, please read our article «How do I close pension gaps?», or consult your pension advisor.


Generali tip: You can use your pillar 3a assets for savings goals, such as buying a home or starting your own business. Your pension advisor will be happy to help.



Families need to plan their budgets carefully to meet their medium- and long-term savings goals. It is important to calculate realistically, find the best pension solutions and think not just about tomorrow, but also about the time after retirement. Don’t lose patience while saving. Because even small monthly contributions can add up to a handsome amount over the years.


Guido studied business economics and is a VBV-certified insurance specialist (Federal Diploma). He has been in the insurance industry for over 25 years and trains insurance experts in the Generali Academy. Guido has an Executive Master of Finance ZHAW and is also an EHB-certified teacher of economics and society (Federal Diploma) and a member of #TeamPensions.


Guido G. Studier, Training Expert at Generali


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