Retirement
Calculator

This retirement calculator projects the future value of your pension savings using compound interest with monthly contributions. Start by entering your current age and your target retirement age. The gap between the two determines your accumulation period — the years your investments have to grow before you begin drawing income.

Enter your current pension savings balance and how much you plan to save each month. The calculator applies your expected annual rate of return, compounded monthly, using the future value formula: FV = PV(1+r)^n + PMT[((1+r)^n - 1) / r], where r is the monthly rate and n is total months until retirement.

Once your projected balance is calculated, the tool applies the 4% rule to estimate a sustainable monthly retirement income. The 4% rule is a widely used guideline suggesting you can safely withdraw 4% of your portfolio per year in retirement, with a strong probability of your money lasting 30 or more years.

The calculator also compares your sustainable income to your desired annual retirement income. If there is a gap, the result card shows the shortfall in red. If your projected savings meet or exceed your goal, a green "On Track" indicator appears. Finally, the tool simulates year-by-year withdrawals — accounting for 4% continued portfolio growth in retirement — to estimate exactly how many years your savings will last.

UK State Pension: The full new State Pension is worth £11,502 per year (2024/25) and requires 35 qualifying years of National Insurance contributions. The State Pension age is currently 66 and is rising to 67 between 2026 and 2028. This calculator focuses on personal and workplace pension savings and does not include State Pension income, so your actual retirement income may be higher than shown.

Workplace pensions and auto-enrolment: Since 2012, UK employers must auto-enrol eligible workers into a workplace pension. The minimum total contribution is 8% of qualifying earnings — 5% from you and 3% from your employer. Many employers offer enhanced matching contributions, so it is worth checking whether you can increase your contribution to receive the full employer match.

Pension freedoms: Since April 2015, you can access your defined contribution pension from age 55 (rising to 57 in 2028). You can take 25% of your pension pot tax-free as a lump sum and draw the rest as taxable income however you choose. The pension lifetime allowance was abolished from April 2024, meaning there is no longer an overall cap on pension savings, although the annual allowance of £60,000 still applies.

The 4% rule: Originally based on the Trinity Study, the 4% rule suggests withdrawing 4% of your portfolio in year one of retirement and adjusting for inflation each subsequent year. Under historical market conditions, this approach has a roughly 95% success rate of lasting 30 years. It is a guideline, not a guarantee — actual results depend on market performance and inflation.