1st pillar (AHV/OASI): complete guide
The 1st pillar is the foundation of the Swiss pension system. Composed mainly of old-age and survivors' insurance (AHV/OASI) and disability insurance (IV/DI), it aims to cover the vital needs of the entire population. Understanding how it works is essential to evaluate your pension gaps and determine how much you need to save in your 3rd pillar.
How the 1st pillar works
Pay-as-you-go principle
Unlike the 2nd and 3rd pillars, which work on a capitalization basis, the 1st pillar is based on the pay-as-you-go principle: contributions from active workers directly fund current retirees' pensions. This system works well as long as the ratio between workers and retirees remains favorable.
Current challenge: in 2026, there are approximately 3 active workers for every retiree. This ratio is declining due to demographic aging, putting the system under pressure and reinforcing the importance of the 3rd pillar.
Who must contribute?
- Employees: contributions deducted from salary (employer and employee share)
- Self-employed: contributions based on net income
- Non-working persons: mandatory minimum contribution from age 21
- Students: minimum contribution from age 21
AHV contribution rates (2026)
| Branch | Total rate | Employee share | Employer share |
|---|---|---|---|
| AHV/OASI | 8.7% | 4.35% | 4.35% |
| IV/DI | 1.4% | 0.7% | 0.7% |
| APG/EO | 0.5% | 0.25% | 0.25% |
| Total | 10.6% | 5.3% | 5.3% |
AHV benefits
Old-age pension
The AHV pension is paid from the ordinary retirement age. The amounts for 2026:
| Type of pension | Minimum | Maximum |
|---|---|---|
| Individual pension | CHF 1,260/month | CHF 2,520/month |
| Couple pension (max.) | CHF 1,890/month | CHF 3,780/month |
Important: the maximum pension of CHF 2,520/month represents only about 35% of an average Swiss salary. To maintain your standard of living, the 2nd and 3rd pillars are indispensable.
Survivors' pension
- Widow/widower pension: 80% of the corresponding old-age pension (subject to conditions)
- Orphan's pension: 40% of the old-age pension per child
Supplementary benefits (PC/EL)
Persons whose AHV (and LPP) pension does not cover vital needs may be entitled to supplementary benefits. These are calculated based on the difference between recognized expenses and determinant income.
AHV retirement age
With the AHV 21 reform that came into effect in 2024:
- Men: 65 years (unchanged)
- Women: progressive increase from 64 to 65 years (65 reached for the 1964 birth year cohort)
- Early retirement: possible from age 63 (with pension reduction)
- Deferral: possible up to age 70 (with pension supplement)
- Partial retirement: now possible, with withdrawal of part of the pension
AHV contribution gaps
Contribution gaps proportionally reduce your future pension. Common causes:
- Years spent abroad without voluntary contributions
- Periods of inactivity not covered
- Late start of contributions (after age 21)
- Omission of the minimum contribution for non-working persons
Tip: order your individual AHV account statement (free) at www.ahv-iv.ch to check your contribution years. Gaps can be filled within 5 years.
The AHV 21 reform and its implications
The AHV 21 reform came into effect on January 1, 2024 and brought significant changes to the 1st pillar. Understanding these changes is essential for properly planning your retirement.
Unification of the reference age at 65
The most notable change is the progressive alignment of women's retirement age with men's, i.e. 65 years. This increase is gradual over several years. Women born in 1961 are the first affected (reference age of 64 years and 3 months), and the age of 65 will be reached for women born from 1964 onwards. For women of the transitional generation, compensation measures are provided in the form of pension supplements.
Flexibility of retirement start (63 to 70 years)
The AHV 21 reform introduces increased flexibility in choosing the time of retirement. It is now possible to:
- Anticipate the pension from age 63: each month of anticipation permanently reduces the pension (actuarial reduction rate). For a 2-year anticipation, the reduction is approximately 13.6%
- Defer the pension up to age 70: each month of deferral permanently increases the pension (actuarial supplement). For a 5-year deferral, the supplement is approximately 31.5%
- Receive a partial retirement: it is now possible to receive a fraction of the pension (between 20% and 80%) while continuing to work part-time. This option can be exercised only once
- Receive the pension by month: the start of the pension can be chosen to the month, and not only on January 1st
This flexibility reinforces the importance of choosing the right time to withdraw the 3rd pillar, which must be coordinated with AHV pension receipt to optimize taxation.
AHV pension calculation examples
The AHV pension depends on two main factors: the contribution period and the average annual determinant income (which includes employment income and bonuses for educational or care tasks).
Example 1: full contribution period, average income
A person who contributed for 44 years with an average annual determinant income of CHF 60,000 will receive a monthly pension of approximately CHF 2,100. This corresponds to the pension between the minimum (CHF 1,260) and maximum (CHF 2,520), calculated according to the FSIO pension scale.
Example 2: 3-year contribution gap
The same person with 3 missing contribution years (for example following a stay abroad without voluntary contributions) would see their pension reduced proportionally: CHF 2,100 x 41/44 = approximately CHF 1,957 per month. The loss is approximately CHF 143 per month, or CHF 1,716 per year, for the entire retirement period. Over 20 years, this represents a cumulative loss of more than CHF 34,000.
Example 3: married couple with different incomes
For a married couple whose calculated individual pensions amount to CHF 2,400 and CHF 1,800, the uncapped total would be CHF 4,200. However, the couple's pension is capped at 150% of the maximum individual pension, i.e. CHF 3,780 per month. The couple loses CHF 420 per month due to the cap. This additional shortfall is yet another reason to build up an individual 3rd pillar for each spouse.
How the 3rd pillar complements the 1st pillar
The AHV pension alone is not sufficient to cover the needs of most retirees. The 3rd pillar allows you to:
- Bridge the gap: build supplementary capital for retirement
- Anticipate risks: protect your loved ones beyond AHV survivors' pensions
- Diversify: the 3rd pillar works on a capitalization basis, less exposed to demographic risks than AHV
- Reduce taxes: 3a contributions are fully deductible from taxable income
Use our retirement capital calculator to evaluate how much you should save in your 3rd pillar to supplement your AHV pension. And to maximize your tax savings, see our page on 3rd pillar tax deductions.
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