UK Retirement Savings Calculator
With UK household savings at their lowest since records began in 1963, many people may be sleepwalking into a life of poverty in retirement. In fact, according to the Pensions and Lifetime Savings Association (PLSA), 8 in 10 brits fear they may not be saving enough for retirement. Our retirement savings calculator will help you understand how much income you could have in retirement at your current rate of savings.
Our retirement planning and savings calculator provides an income estimate based on what you save and invest each month. It’s based on your lifestyle, financial commitments, and investment returns. Our calculator for retirement savings is not designed to replace professional advice, always talk to a qualified financial adviser before you make any pension decisions. To get advice now, please contact us.
User Guide for our Retirement Savings Calculator
1) Current Age
Enter your current age
2) Retirement Age
The age at which you intend to retire. If you intend to retire at your State Pensionable Age you can use our handy State Pension calculator to find out both your state pension age and likely state pension income.
3) Savings Amount
How much are you saving monthly? If you are saving into a pension, you can include any employer contributions and government tax-back in this amount.
4) Amount Already Saved
How much do you already have saved in your pension? Do not include any savings that you have elsewhere as this calculator works out the compounded amount based on anticipated interest earnt on pension investments.
5) Investment Rate
This refers to an expected rate of return on your investments and should be net of fees. This figure is based on long-term investment return and will include any dividends paid on your investments. The amount you can expect your investments to return is directly linked to the amount of risk you are prepared to take as an investor – understanding that as an investor higher returns are often linked to a higher risk of loss.
What sort of returns can you expect based on your investor risk profile?
Take a look at our Pension Forecast Calculator to see how these types of investments have performed over the last 100 years.
6) Total Savings
The calculator will estimate the total size of your pension pot at retirement based on your current age, age at retirement, monthly savings amount, amount already saved and your rate of return.
Select the country you have lived most of your life in – this will provide a basis for your life expectancy. This is a national average figure and is not based on gender – if you would like to see a more detailed breakdown with estimates for living to 100 use our life expectancy calculator.
8) Life Expectancy
This is automatically populated based on your age and the country you have selected.
9) State Pension
You can add in the amount you are forecasted to receive from your State Pension but be aware that this calculator assumes retirement at State Pensionable Age. If you add in your State Pension amount, you’ll need to make sure that your retirement age is set at your State Retirement Age. Use our State Pension Calculator to work out both the State retirement age and state pension estimate. Alternatively, request a state pension forecast.
10) Retirement Income
Given all of the variables, this calculator will work out how much monthly income you are likely to have in retirement.
How You Can Use Our Retirement Planning Calculator
You can use our retirement planning calculator to estimate the size of your pension pot based on your current rate of savings and you can adjust your monthly savings figure to see how that could affect the size of your pension pot in retirement.
You can also see how adjusting your retirement age might affect the size of your pension pot, since the longer you save, the more you will have in your pension.
You’ll also be able to see how both of these factors affect your likely monthly income in retirement.
How This Retirement Savings Calculator Can Help You
There are a number of variables in retirement planning that are within your control, the two main ones are the age at which you retire and the amount you choose to save now. This calculator will help you see what impact these two things can have on your retirement plans and your likely income in retirement.
If you’re in a couple you can use our simple couples retirement calculator to work out how much you’ll need every year in retirement, based on the lifestyle you want to live. We also have a retirement cost calculator dedicated to singles. Both use UK based average costs to make your retirement planning easier.
How Much Will You Need to Retire?
Planning your expenses in retirement can be a daunting task, especially if you’re planning years ahead, so we’ve created the world’s easiest retirement calculator to help you work out how much you’ll need. We also cover 3 simple ways to work out how much you need in retirement in our cost of retirement blog.
We’ve also compiled some industry estimates for what you’ll need in retirement here>>
How Much Should You Save for Retirement?
Ultimately, a simple retirement savings calculator like this is not detailed enough to base your retirement plans on, although retirement calculators can be a good place to start.
How much you need to save is relative to the amount of income you want in retirement, what age you plan to retire at, how much you can afford to save (and for how long) as well as your investment choices and risk profile. In our blog post “What is a good retirement income?” we explore Minimum Income Standards in retirement as well as UK average retirement income and how to sustain your current living standard in retirement. We’ve also put together some use calculators that will help you work out likely retirement costs in our post How much do I need to retire?
The Definitive Guide to a Comfortable Retirement
Download our free guide to a comfortable retirement to understand what is a “good” retirement income, what the experts think you’ll need to retire and what current retirees spend on average for a basic, comfortable and luxury retirement.
Our specialist Financial Advisers are experts in retirement and later life planning, why not arrange a free call with a financial adviser to discuss your options. We can help you build a retirement plan based on your unique circumstances and goals.
Accessing your Pension for Early Retirement
Pensions are the most tax efficient way of saving in the UK, especially if you’re a higher rate taxpayer, so it’s best practice to save into a pension first before exploring other options like ISAs.
However, It is important to know that if you are investing in a pension, you will not be able to access it until you are 55. From 55 you can access 25% of your pension as tax-free cash and you don’t have to take it all at once, so you could use some of that money to subsidise an early retirement using pension drawdown.
If you plan to retire before 55, you could use your annual ISA allowance to save and invest your money – any gains and dividends from investments held within an ISA are tax-free
then you should speak to a financial adviser to create a plan that will still provide tax-efficient savings and also allow you to reach your financial goals.
HOW AN IFA CAN HELP YOU
An Independent Financial Adviser can help guide you through life’s major decisions in a number of areas
SIPPs, Flexible Drawdown, Tax-Free Lump Sum, let our experts talk you through your options at retirement and help you meet your goals
Wealth Management & Investments
Make your money work harder for you. Invest tax-efficiently and spread your risk effectively. Our investment experts can help you build a long-term investment plan.
Whether you’re consolidating for ease, preparing for retirement or trying to reach your financial goals through a Pension Transfer, we can help. We’re specialists in this field with over 15 years of expert experience, so you’ll be in safe hands.
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Join the hundreds of happy 2020 Financial customers looking forward to their dream retirement.
This retirement and investment calculator is provided for general information purposes only. It is a guide and does not reflect the actual amount that you will need in retirement.
Any information contained within this website should not be deemed to constitute financial advice, and should not be relied upon as the basis for a decision to enter into a transaction, or as the basis for any financial or investment decision. It is provided for general information and it is vital (and in most cases a regulatory requirement) that you contact a Financial Adviser for tailored professional advice in regard to pension and retirement planning.
- No individual or company should act upon such information without receiving appropriate professional advice after a thorough examination of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of any articles.
- If you are a member of a pension scheme with safeguarded benefits, it is likely it would be in your best interests to retain the safeguarded benefits.
- Make sure you understand all the risks before investing.
- The value of investments and the income they produce can fall as well as rise and you may not get back your original investment. Past performance is not a reliable indicator of future results.