What this checker works out
This checker projects your pension pot forward to retirement, converts it into an annual income at a withdrawal rate you choose, adds your expected State Pension and other income, and compares the total against the retirement income you want.
The result is a gap — an annual shortfall or surplus. It is a planning figure built on assumptions you set, not a forecast, and the section on limitations explains exactly how much weight it can bear.
Retirement gap estimate
Before you rely on the result
- Find your actual pot value from your pension provider or your annual statement, and add any old pots from previous employers.
- Use your total monthly contribution including your employer's, not just your own.
- Get a State Pension forecast from GOV.UK rather than guessing. It is free, takes minutes, and is based on your actual National Insurance record.
- Set the growth rate deliberately. It is an assumption about the future, and it drives the result more than any other input.
It comes from historical studies of US portfolios and suggests a starting withdrawal that had a good chance of lasting 30 years. It is widely used because it is simple, and widely criticised because it depends on the period studied, the asset mix, charges and how long you live. Treat it as a reference point, and test lower rates.
How this calculator works
Three steps: grow the pot, convert it to income, then compare:
Years = retirement age − current age
Future pot = pot × (1 + g)years + annual contribution × [ ((1 + g)years − 1) ÷ g ]
Income from pot = future pot × withdrawal rate
Gap = target income − (income from pot + other income)The growth rate and withdrawal rate are both editable fields, because both are assumptions rather than facts. The projection uses a single constant growth rate applied every year, which no real investment delivers — it expresses an average, not a path.
Everything here is in future money and takes no account of charges, inflation or tax on withdrawals. A target of £24,000 in twenty years' time will buy considerably less than £24,000 buys today.
Worked example: age 45, retiring at 67
Using the default figures — a £60,000 pot, £300 a month in contributions, 22 years to run, 4% growth, a 4% withdrawal rate, an £11,000 State Pension and a £24,000 target:
- Projected pot at 67: £265,488
- Income from the pot at 4%: £10,620 a year
- Plus State Pension: total £21,620 a year
- Gap against the £24,000 target: £2,380 a year short
Closing a £2,380 gap needs roughly £59,500 more in the pot, which at 4% growth means about £150 a month more from now. Alternatively, working two years longer, or accepting £21,620, closes it a different way. The value of this calculation is that it turns a vague worry into three concrete options — and finding out at 45 rather than 63 is what makes them available.
Common mistakes
- Guessing the State Pension. Get the free forecast; it depends on your National Insurance record and may be less than the full amount.
- Using an optimistic growth rate. Over 22 years the difference between 4% and 6% is enormous, and charges come out of whichever you assume.
- Reading the target in today's money. The projection is in future money, which will buy less.
- Forgetting old pension pots. They count towards the total and are often forgotten.
- Treating a single projection as the answer. Run several growth rates and look at the spread.
Frequently asked questions
What growth rate should I assume?
There is no right answer, which is why it is an editable field. Regulated projections commonly use a range of low, medium and high assumptions rather than a single figure, and that is a sensible approach here too. Run the checker at 3%, 5% and 7% and look at the spread of outcomes — the range is more informative than any single number, and it shows how much of the plan depends on markets rather than on you.
How do I find my State Pension forecast?
Through GOV.UK, using your Government Gateway account. It shows what you have built up so far, what you could get if you keep contributing, and your State Pension age. You generally need around 35 qualifying years for the full new State Pension and at least 10 to receive anything at all.
Does this account for inflation?
No. Both the projected pot and the target are in future money. To see the result in today's terms, run the projected income through the Inflation Impact Calculator, or enter a real growth rate — your assumed return minus assumed inflation — which produces a result already expressed in today's purchasing power.
What income will I actually need in retirement?
Less than you might expect, in most cases — the mortgage is often gone, commuting stops and pension contributions cease. A common approach is to target somewhere between half and two-thirds of pre-retirement income. The Pensions and Lifetime Savings Association publishes retirement living standards that give concrete figures for minimum, moderate and comfortable retirements, which many people find more useful than a percentage.
Should I get advice?
For anything consequential, yes. Pension Wise offers free, impartial guidance to over-50s through MoneyHelper, and it is genuinely useful. For decisions involving transferring a defined benefit pension, drawdown strategy or tax planning, a regulated independent financial adviser is worth the fee.
Related tools
References
- GOV.UK — State Pension forecast, State Pension age and qualifying years
- MoneyHelper — free pension guidance and the Pension Wise appointment service
- Financial Conduct Authority — rules on pension projections and the regulated advice register
Sources are checked at publication and can change — how I choose and check references.