Breakdown
How it works
Contributions compound at the assumed growth rate until retirement. The pot is then deflated by inflation to show what it is worth in today's terms, and a withdrawal rate (4% is the common rule of thumb) converts it to an annual income. If that income falls short of your target, the calculator solves for the extra monthly contribution needed.
Formula
Worked example
Age 35, retire 65, 50,000 saved, 800 a month, 6% growth, 2.5% inflation: pot ≈ 1,105,000 nominal ≈ 527,000 today, giving ≈ 21,000 a year at 4%. For 30,000 you need ≈ 750,000 real — about 465 a month more.
Frequently asked questions
What growth rate should I assume?
5–7% nominal for a diversified equity-heavy portfolio over 20+ years; 4–5% if balanced. Always pair it with 2–3% inflation to see real values.
What is the 4% rule?
Withdrawing 4% of the pot in year one and rising with inflation has historically lasted 30+ years in most scenarios. Use 3–3.5% for very early retirement or extra caution.
Does this include the State Pension?
No. Add it to the sustainable income shown — the full UK new State Pension is about £12,500 a year from age 66–68. GCC expats generally have no state pension from the host country.
Should I include employer contributions?
Yes — enter the total going into the pot each month including employer and tax relief.
What about tax in retirement?
Not modelled. UK pension income is taxable above the personal allowance; 25% of a DC pot can be taken tax-free. ISAs are tax-free.