Finally! You've successfully completed your education, written job applications, attended interviews and now finally, your long-awaited first job. And with it, the joy of your well-earned salary.
Ta-da! Your salary arrives in your account on time on the 25th of the month; your very own money! To begin with, the fixed income at the start of your career almost feels like you've won the lottery. Well, it might not be the jackpot, but compared to a student job or apprentice wage, it's really impressive to be receiving a regular "proper" paycheck. However, this new capital also brings responsibility with it, in that you now have to set priorities and manage your earned money wisely.
Career starters quickly realize that they have less money than they first thought. That's because their paycheck doesn't tally with what was agreed during the interview. Although your company actually pays you that amount, your salary is subject to a few deductions, such as social security insurance, accident insurance, daily sickness benefits insurance etc.
In Switzerland, you must expect a deduction of 14 - 20 percent on average, but there are massive differences. Basically, the deductions rise as employees get older. The greatest share of this is accounted for by social security payments (in german). All deductions have to be listed on the monthly salary slip.
Non-occupational accident insurance is only compulsory for anyone working more than eight hours a week. Daily sickness benefits insurance is voluntary but very popular.
Planning your finances may seem tiresome and complicated at first glance, particularly for young people who are particularly pleased to get their first paycheck. But it's worth getting your finances in order right from the start. Follow these seven simple steps so that you always have an overview of your money:
"Now I can afford something for the first time in my life, but I'm supposed to think about my pension instead when I get my first paycheck?" Of course, this thought seems absurd to young people, but it's justifiable from a financial perspective. This is because if you want to maintain your accustomed standard of living in old age, you should start saving for it as soon as possible. The decisions you make today have a crucial impact on the rest of your life. You can also benefit from a savings plan long before retirement, for instance regarding self-employment or home ownership. Takeaway: You should definitely enjoy your salary! Spoil yourself with something that gives you pleasure. But think about the far-off future too. The following tips can help you when it comes to private pension provision:
After completing your studies, you should check whether you have actually paid the OASI minimum amount every year. The best thing is to ask for an individual account statement from your compensation office. Contribution gaps that are less than five years old can be closed retrospectively. Failure to make a back-payment in time can result in a reduced pension under certain circumstances.
Do you earn more than CHF 22,050 p.a.? Because this is the threshold from which both you and your employer are required to pay contributions into Pillar 2. If you have two small jobs with two different companies, find out whether both salaries can be insured in the same pension fund.
Employees working part-time are also disadvantaged by the "coordination deduction".
As soon as you have your first job, you should think about a Pillar 3a account with your bank or a pension plan with your insurer. The latter can be combined with individual risk cover. But whether it's with a bank or an insurance company, the main thing is that you're saving for your future. Particularly attractive: you can deduct the amount paid in from your taxable income. This way you can save a tidy sum over the years.
There are still decades to go until you retire. Use this time to invest your pension capital in securities. This naturally carries risk, as the financial markets are always subject to certain fluctuations. But if the money is invested over a long period, the yield from securities such as equities is normally the most attractive.