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How this works
The calculator adds up what you and your employer pay in each month, grows the pot until your retirement age, then shows what yearly income it could give. Everything is shown in today’s money, so growth and pay rises are reduced by inflation first.
Contributions are a share of your qualifying earnings, the part of your salary between £6,240 and £50,270, or of your full salary if your scheme uses that. Retirement income is the pot multiplied by a withdrawal rate, plus the State Pension if you include it.
What it assumes
- Investment growth is steady. In reality it goes up and down.
- Up to 25% of the pot can be taken tax-free, capped at £268,275. Pension income is taxable.
- The full new State Pension is £241.30 a week, which needs 35 qualifying years.
Worked example
Age 30, £35,000 salary, £20,000 pot
- You pay 5% and your employer 3% of qualifying earnings. You expect 5% growth, 2.5% inflation and 3% pay rises, and plan to retire at 68.
- In the first year you pay in £1,438.00, but it costs you only £1,150.40 after £287.60 of tax relief. Your employer adds £862.80.
- By 68 the pot could be worth £206,921 in today’s money: £61,012 from you, £36,607 from your employer and £89,302 from growth.
- You could take £51,730 tax-free. A 4% withdrawal gives £8,277 a year, and with the full State Pension of £12,547.60 your income is about £20,824.
Worked out with the same maths as the calculator above.
What to do next
Common questions
How much should I pay into my pension?
The auto-enrolment minimum is 8% of qualifying earnings in total, with at least 3% from your employer. A common rule of thumb is to take half your age when you start and pay in that percentage, including your employer’s share.
Why is everything in today’s money?
A pot of £500,000 in 40 years won’t buy what £500,000 buys now. Showing it in today’s prices makes it easier to judge whether the income would be enough.
When can I take my pension?
Usually from 55, rising to 57 from 6 April 2028. State Pension age is 66, rising to 67 between 2026 and 2028.
Is there a limit on how much I can pay in?
You get tax relief on contributions up to your yearly earnings, and the annual allowance caps the total paid in by you and your employer at £60,000 a year. It can be lower for very high earners or if you’ve already started taking money out.