Dear Community,

I save monthly in the $JEGP (+1,27 %) savings plan and am naturally pleased about the monthly dividend payment. How do you handle this payout, do you reinvest it straight back into the JEGP or do you use the dividend to buy other shares in your portfolio?

I'm interested to know why many $JEGP (+1,27 %) in the portfolio, although there is also the $WINC (+1,59 %) which pursues a similar strategy but has a higher return and higher distribution so far.

Hi guys, what do you think of $JEGP (+1,27 %) as an alternative to call money as I put some of the rental income aside and would otherwise take it as call money, but this variant makes more sense, the rest is invested in the $VWRL (+1,93 %) or the $VUSA (+1,82 %) so don't worry, it should really only serve as a substitute for overnight money :)

What do you think?

Have a nice evening everyone.

(Article written while England are playing Italy in the Women's European Championship - you have to set priorities 😉)

Edit: I almost missed it! THANK YOU for 300 followers and soon 400k post views. 💕

Investing in Switzerland has a number of tax advantages, especially compared to many other countries. But the same applies here: those who are familiar with the system can plan better in the long term and optimize returns more cleanly. The article offers all interested parties (including those from abroad 😅) an overview, from withholding tax and the amount of tax to the question of whether dividends really make sense. At the end is an OECD overview of taxes and the tax burden.

Tax landscape briefly explained

Switzerland has no capital gains tax on custody accounts - capital gains on securities are tax-free for private individuals. We do not have all the pots like in Germany.

Anyone who invests in securities for the long term can take full advantage of the compound interest effect anyway, but the following taxes are to be expected:

• Dividends are considered income and are fully taxable (income tax)
• Withholding tax35 % on dividends from Swiss shares (reclaimable if declared correctly . Was and is particularly relevant for the prevention of tax evasion, before bilateral agreements and automatic exchange of information)
• Stamp duty0.15 % on Swiss shares, 0.30 % on foreign shares (when purchased via a Swiss broker)
• Wealth taxAnnual on the value of all assets

Of course there are other taxes, but I am focusing here on direct, investment-relevant taxes.

How heavily are income and assets really taxed?

Switzerland has a federal tax system - the effective tax burden differs massively depending on where you live. The following chart illustrates this nicely:

For example, in Zug or Schwyz you pay less than 25% on high incomes - while Geneva comes to over 45%. The national average is around 36,4 %.

And in the "world-famous city" of Zurich specifically?

Anyone with a taxable income of around CHF 100,000 in the city of Zurich will end up with an effective tax burden of around 16%. The marginal tax rate increases significantly with income - at CHF 300,000 you quickly reach over 40 %.

I feel very much at home in Zug - but the low taxes are partly offset by the high cost of living. Below an income of around CHF 120k p.a., it is almost irrelevant where you live in Switzerland, as the costs level out. Above that, however, it becomes extremely interesting.

The FTA tax calculator from the federal government allows you to calculate various combinations. I strongly recommend it, even if you are planning to move to or within Switzerland.

Example calculation: Growth vs. dividends

But I don't want to lose the thread completely. My point in this post was also to compare the divi vs. growth strategy from a Swiss perspective.

Let's take two investors, both starting with CHF 100,000.

• Investor A (Growth)7% annual capital gains, no dividends
• Investor B (Dividends)7 % annual dividend, reinvesting p.a. fully taxable at 25 % (effective tax rate) = (7% *0.75 = 5.25% effective return), no capital gains

After 20 years the result is

• Growth portfolio386'968.45CHF (tax-free)
• Dividend portfolioCHF 278,254.45 (reinvested after tax)

Difference: almost CHF 110k - only because of the tax effect and the corresponding reduction in performance.

*The assumptions are exemplary, wealth tax ignored, moneyland calculator as source. I realize that performance can also be achieved with a high divi, etc. Don't hang yourselves and me on it 😉

So, $NVDA (+4,49 %) or $JEGP (+1,27 %) for you?

Why dividends can still make sense

Despite the tax disadvantage, dividends have their appeal for many investors, including me:

• Motivation & disciplineRegular distributions create a tangible sense of achievement
• Cash flow: Particularly valuable in retirement or on a reduced income
• Market psychology: In sideways or bear markets, dividends bring stability - perceived and real
• Historically stable companies: Many dividend payers are established companies with a robust business model

Investing in Switzerland is therefore often a gift from a tax perspective, especially for long-term investors with a focus on capital gains.

Anyone pursuing dividend strategies should be aware of the tax losses and weigh up whether cash flow or reinvestment has priority.

For me, it's the mix that makes the difference. With a dividend yield of around 2.7% across the portfolio, I feel comfortable, I am satisfied with my performance and the dividend growth is impressive. I'm not out to earn my living expenses through dividends. I go to work for that. My investments are intended as a cushion for PE investments, starting a business, buying a house or other "milestones" in life - or to make it easier to achieve these goals.

So, dear Swiss people, let me know what you think. Dear friends from near and far abroad: What's your situation?

Let's discuss over a fondue. 💕😉

Bonus, as promised:

Incidentally, taxes are not just a "cost factor", but also finance key elements of social welfare: in Switzerland, for example, the AHV, education, healthcare, infrastructure and security. According to the OECD, we spend around 28,000 CHF annually on state benefits - one of the highest figures in the world. This shows that What we pay in taxes does not flow into nothing, but contributes significantly to the quality of life, social stability and attractiveness of a location. Those who invest ultimately also benefit from it. At the end of the day, I am happy to pay taxes (but optimize wherever I can).

Happy investing

GG

#schweiz
#dividende
#steuern
#geldgenie #BestOfGG #wissen