Using Your Pension Fund to Buy a Home (WEF)
How the early withdrawal for home ownership works, its tax effect and the risks for your cover.
6 min read · Retirement & Pensions
The Swiss system lets you use pension fund money for your own home. This is called WEF (Wohneigentumsförderung).
How it works
You can withdraw part of your second-pillar savings, or pledge it, to buy or build your primary residence, to join a housing co-operative or to repay a mortgage. The minimum withdrawal is usually CHF 20,000, and you may withdraw only once every five years. After age 50 the maximum is limited to the savings you had at 50 or half of your current balance.
- Own funds from cash / savings / 3a securitiesCHF 120’000 · 13 %
- Own funds from pension fund (2nd pillar)CHF 60’000 · 7 %
- Mortgage neededCHF 720’000 · 80 %
Example with default values. Open the calculator →
Tax and registration
- The withdrawal is taxed once at a reduced rate, separately from your income.
- A restriction is entered in the land register, so the property cannot be sold freely without repaying the money (or transferring it).
- If you sell, you must repay the amount or move it into a new home.
Watch your insurance
A withdrawal reduces your retirement capital and often your disability and death benefits too. Ask your fund how benefits change and, if needed, buy supplementary cover. Remember that banks accept pension money only for the part of equity above the 10 % hard equity.
Pledge or withdraw?
A pledge keeps your capital in the fund and avoids tax now, but banks count it less favourably and you cannot use it to lower the interest. Compare both with your bank.
Check whether your plan works with the affordability calculator.