How much money should you save for your child?

How much Swiss families can set aside is, of course, a very individual matter depending on their budget. But let’s be honest: don’t we all like to compare ourselves to others from time to time? We think so!

That’s why we’re showing you a few average figures and sample calculations here. Spoiler: even small amounts add up over a long period of time!

How much others are saving

How much families can put aside depends heavily on their income and day-to-day expenses. According to figures from the Federal Statistical Office (FSO), the median disposable income for Swiss households is 4’332 CHF per month. After rent, health insurance and weekly shopping, that figure is significantly lower. Taking household income and expenditure into account, we estimate that families have around CHF 220 left in their account at the end of the month.

That is the amount that theoretically remains – but we all know how quickly unplanned expenses crop up in everyday life with children. Yet savings, pensions and other financial goals are important to Swiss families. Our survey on saving showed that 68% of parents set money aside for their children.

Our recommendation: Save at least CHF 35 per month

«I don’t have enough left over to save.» Even if most parents probably don’t have 220 CHF left over each month, the important thing is to save for the future at all.

Here at Clanq, we recommend that parents set aside at least a small fixed monthly amount to save for their child. This could be 35 CHF, or a little more or less – the important thing is to start as early as possible. After all, saving small amounts regularly is not only extremely sensible, but also easier to manage than saving large sums all at once.

Recommended savings rate for families

That would certainly be a good start!

Save 10 CHF when you pay with Clanq

Imagine that every time you go shopping or order something online, you put 1% of the amount you’ve just paid into a piggy bank. And imagine that this money doesn’t come out of your own wallet, but from Clanq!

With the Clanq Premium Cashback programme, you get money back on every purchase – straight into your child’s digital piggy bank, completely automatically. All you have to do is pay with your Clanq card.

With average monthly spending of around 1’000 CHF on groceries, household goods and everyday essentials, that’s 10 CHF per month per household.

Save a further 8 CHF with extra cashback

When you shop with our cashback partners, Clanq gives you extra cashback into the piggy bank. Our partners cover many areas relevant to families, such as (children’s) clothing, toys, family outings, personal care products and health. 

The amount of partner cashback varies from 1% to 25%. Across all partners, the average is around 8%. Let’s say you spend 100 CHF in a month with our cashback partners (e.g. kkiosk, Online-apotheke.ch, LetsFamily, fit-und-warm.ch, TCS and many more); you can expect roughly 8 CHF per month in additional cashback.

Here you’ll find an overview of all Clanq partners offering extra cashback.

The family clan as a multiplier

Our tip: Get your family to join in and save together to earn even more cashback. For every additional person who pays for their purchases with Clanq, you can add the same cashback amount again.

After all, grandparents, aunts, uncles, godmothers or godfathers can also support your child financially. In Switzerland, this form of support is very common. Of course, it varies from family to family as to whether anyone else is willing or able to help save.

Many people need or want a credit card anyway. Clanq’s «card with heart» works just like any other credit card, except that with every purchase, cashback goes into your child’s digital piggy bank.

This way, for every family member who contributes via credit card, you can add a tidy sum to the piggy bank – depending on how much that person spends.

Saving as a family – here’s how

Small amounts add up

Are you sure you don’t have «enough» left over to save? Lots of small contributions add up to a considerable sum. And the cashback doesn’t even come out of your own budget.

Example of a savings rate

Hypothetical scenario: Both parents set aside 35 CHF per month from their own money. Another person contributes via their cashback.

If you start early, you’ll benefit from interest and compound interest

Our strong recommendation: Start saving early with small amounts. Over a long period, for example 18 years, you’ll accumulate more than you might think!

Bear in mind: part of your savings will be eroded by inflation. So, don’t hide cash away – make sure you put it into an account where you earn interest. With Clanq, you currently earn 0.25% interest p.a. on your savings account (up to 100’000 CHF). Using the 1’272 CHF from our example above, that would amount to:

• Annual deposit: 1’272 CHF
• Total deposits (after 18 years): 22’896 CHF
• Interest earned (compound interest): ~525 CHF
• Final balance: ~ 23’421 CHF

Next level: Thinking about investments

For 81% of parents surveyed, their savings remain in a savings account. But if you want your money to grow in the long term, rather than just keeping pace with inflation, there’s no getting round the need to invest.

The good news is that it’s not that complicated, and there are certainly family-friendly financial products available with relatively manageable risk.

With the Cornèr fund savings plan in Clanq, you can invest wisely in your child’s future. For our example, we’ll assume a long-term return of 5% per year – which is entirely realistic given normal market conditions. By way of comparison: historically, shares worldwide have actually achieved an average return of just under 7% per year.

So if you invest 100 CHF a month (which you can easily cover with cashback, as the example above shows), after 18 years you will have paid in a total of 21’600 CHF out of your own pocket. Thanks to compound interest, however, the final result looks like this:

• Capital paid in: 21’600 CHF
• Interest earned (5 per cent annual return): ~13’320 CHF
• Final balance after 18 years: ~ 34’920 CHF

The effect of compound interest

Conclusion: Saving and investing pays off

Security should be the top priority when investing money for your child. The interest rates on a traditional savings account are the safest option, whereas investments allow you to get more out of your money.

We generally recommend safeguarding your child’s financial future with broadly diversified investments. Fund investments are also suitable for families on a limited budget. Invested wisely and over the long term, even just a few francs a month can make a big difference to your child’s future.

Of course, everyday family life is stressful and time is in short supply – nobody wants to spend hours mulling over finances. The good news is: with Clanq, you don’t have to. You set up the Cornèr Accumulation Fonds just once, and it’s really straightforward. After that, everything runs completely automatically in the background. With this minimal effort, you stand to build up a starting capital of around 35’000 CHF for your child. So, once you’ve set it up, your provision for the future pays for itself – with complete peace of mind!