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Created on 07.07.2022 | Updated on 03.11.2023

Investing in a low interest rate environment: comparison of three options

Consume less, save more. That’s a good plan. However, because interest rates are historically low, savings accounts are not very attractive. Those who want to build up their assets over the long term should examine the alternatives. One possibility is an investment in the financial markets.

During the pandemic, saving was easier for some people. Restaurants were shut, concerts cancelled, borders closed. Simply put, there was not much to spend money on. According to the Swiss Federal Statistical Office, on average up to 30% of income was saved during the lockdowns.

But assets in savings accounts are increasing only slowly. Banks are granting little or no interest. Others are charging negative interest depending on the assets. What opportunities are there to save money when interest rates are historically low?

Building up assets: a direct comparison of three options

There are generally three popular ways to save money – each with its advantages and disadvantages:

Savings account

Ideal for saving money easily, flexibly and over the long term.

Hardly any interest, sometimes even negative interest.


By buying securities, participating in the capital market can also be an effective means of building up assets in the long term with the yield opportunities.

The assets are subject to market fluctuations and the performance can also take on negative values. In order to counteract market fluctuations, the investment time horizon should, if possible, be long-term.

Retirement savings

Primarily serves private retirement provision (3rd pillar). The savings contributions made can be deducted from taxable income.

3a assets can only be accessed under certain conditions.

Benefit from potential returns with investments

The performance of assets in savings accounts and in the pillar 3a retirement account is negatively affected by low interest rates. One way of getting more out of your money is to invest or save in securities with retirement funds. Those who invest their money in capital markets do not receive a guaranteed return, but they can benefit from the return opportunities on the financial markets in the longer term.

What’s more, investing in the financial markets is no longer that difficult. Today, there are various options – including digital ones – that facilitate access to the financial markets and make investing your money easier. Those who do not have time to deal with the financial markets and investing can nowadays delegate the task – for example via e-asset management from PostFinance. You can find out more about tailor-made investment solutions in the article “Is there a tailored investment solution out there for me?”.

However, investing is not without risk, and you have to accept market fluctuations. People should therefore only invest in accordance with their own risk capacity, risk tolerance and desired investment horizon, and consistently pursue the chosen investment strategy over the long term.

The most important aspects of investing

  • Investment decisions require some time and financial knowledge. If you do not want the hassle of making investment decisions, you can delegate to an expert. The expert keeps an eye on the financial markets for their customers.

    Such delegating is made possible by PostFinance’s e-asset management, for example. In this approach, first the investor profile is determined and the individual investment strategy defined. PostFinance’s investment experts then take care of the rest. However, if you know your investment strategy and can keep an eye on the financial markets yourself, suitable investment solutions from PostFinance will help you achieve your personal investment goals.

  • You can invest in the various asset classes either directly, e.g. by buying shares, or indirectly via a fund, ETF or retirement fund. The advantage of indirect investing is that you only need to buy one fund unit or ETF in order to invest in many different financial assets. This usually significantly reduces the risk compared to investing in individual securities owing to the diversification effect.

    Find out more in the article “Sit back and relax: with PostFinance asset management, you can let your assets work for you”.

  • Returns depend on many factors, such as company performance, interest rates, inflation or market sentiment. 2021 was a good year for the equities asset class in particular. The Swiss Market Index (SMI), which includes the 20 largest shares listed on the Swiss stock exchange, gained around 20%. The Swiss bond index, on the other hand, performed negatively due to low interest rates. The return in 2021 was almost minus two percent. But it’s not possible to draw conclusions about the future based on the returns of the past year.
  • Fees are charged for depositing money. These are usually custody fees, transaction fees and management fees. The latter are charged on indirect investments such as ETFs or funds. Many new providers from Switzerland and abroad have entered the market in recent years. This has put pressure on fees. Some online platforms, for instance, no longer charge any custody fees at all or only very low transaction fees (brokerage fees).

Final editing of this text is March 2022. Our PostFinance market view reports on current events on the financial markets. 

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