Switzerland's pension scheme is based on a "three-pillar" system written into the constitution in 1972.

The first pillar is the state old age pension and it has been in force since 1948.

All people living and working in Switzerland have to contribute to the scheme and it is the minimum cover guaranteed by the state

The second pillar, the occupational benefit plan or company pension, is also compulsory, but only for those earning more than SFr25,000 a year.

Employees and employers pay equal amounts into pension scheme managed pension funds, often run by one of the big insurance companies.

The laws governing company pensions were introduced in 1985, and the minimum yield was set at four per cent. It has remained at that level for the past 17 years.

The main benefits provided by the occupational pension plan are payment of old age pensions, widows' and orphans' pensions and invalidity pensions.

The third pillar is individual private pension plans, which can be either non-indexed linked or indexed linked.

Non-index linked plans include life insurance, capital investments or house purchases. Linked savings plans may be created through an insurance policy or a bank savings plan.

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