Voluntary private provision forms the 3rd pillar of the Swiss 3-pillar concept. Your goal is to supplement the benefits from the 1st and 2nd pillars to close any potential pension shortfalls, or to cover individual needs. Together with the AHV and the occupational pension (BVG), 3rd pillar funds are suitable for continuing one's normal standard of living after retirement. The 3rd pillar is subdivided into restricted (pillar 3a) and unrestricted pension plans (pillar 3b).
Pillar 3a is used for a voluntary personal pension. It allows employed persons to build up their own retirement capital or to ensure later amortisation of a mortgage, for instance.
When building up an unrestricted pension plan there is unlimited freedom, but there are fewer or no tax privileges. Pillar 3b combines all the assets that are not already fixed in pillars 1, 2 and 3a. Pillar 3b includes traditional voluntary saving and investing for various goals, such as for education, retirement, a holiday, a new car, etc. Unlike pillar 3a, pillar 3b assets are freely available at any time.