Year-by-year pension growth
| Age | Year | Contributions | Growth | Pot Value |
|---|
How pension growth works
Your pension pot grows through two forces: regular contributions (yours and your employer's) and compound investment returns. The longer your money is invested, the more powerful compounding becomes.
The power of compound growth
Each year, your pot grows by the net growth rate (your expected growth minus the management charge). Growth in year one earns its own growth in year two, and so on. Starting early makes a dramatic difference because of this compounding effect.
Net growth rate
If your expected return is 5% and your provider charges 0.75%, your net growth rate is 4.25%. Over decades, even small differences in charges have a significant impact on your final pot. A 0.5% higher charge on a pot growing for 30 years can cost tens of thousands of pounds.
The 4% drawdown rule
The 4% rule suggests withdrawing 4% of your pot in the first year of retirement, then adjusting that amount for inflation each year. Research suggests this approach gives a high probability of your money lasting at least 30 years. It is a guideline, not a guarantee, and your actual sustainable withdrawal rate depends on market conditions and how long you need the money to last.
What this calculator does not include
This projection does not account for the State Pension (the full new State Pension is £241.30 a week, about £12,548 a year, in 2026/27), salary increases over time, tax relief on contributions, inflation eroding purchasing power, or the 25% tax-free lump sum you can take at retirement. Treat the figures as a useful guide rather than a precise forecast.
Worked examples
Each example below was run through the calculator above. All three follow the same saver: aged 30, retiring at 67, with £10,000 already saved, an employer paying £100 a month, and 5% a year growth before charges. Figures are in future pounds, not adjusted for inflation, and the income line is 4% of the pot in the first year.
The starting point: £150 a month, 0.75% charges
Over 37 years the saver pays in £66,600 and the employer £44,400. The projected pot is £317,615, of which £196,615 is investment growth. A 4% first-year withdrawal is £12,705 a year, before tax and on top of any State Pension.
Same saver, charges of 0.25% instead of 0.75%
Nothing changes except the annual charge, and the pot at 67 rises to £360,732, about £43,100 more than the first example. Charges are taken from the whole pot every year, so a half-point gap compounds over decades. Your provider's annual statement shows the charge you pay.
Same saver, counting tax relief: £187.50 instead of £150
In a relief at source scheme, £150 from your bank account becomes £187.50 in the pension once the provider adds 20% basic rate relief. Entering the gross figure gives a pot of £358,049, with £83,250 counted as your contributions. Entering £150 understates the pot by about £40,000 in this case.
Rules that change the answer
Tax relief and the annual allowance
You get tax relief on contributions up to 100% of your earnings, and the annual allowance is £60,000. It is tapered if threshold income is over £200,000 and adjusted income over £260,000, and it can be reduced once you flexibly access a pension. Higher and additional rate taxpayers in relief at source schemes claim the extra relief themselves, usually through Self Assessment (GOV.UK: Tax on your private pension contributions, checked 30 October 2026).
The tax-free lump sum
You can usually take up to 25% of a pension as a tax-free lump sum, capped at £268,275 across all your pensions (same source). The rest is taxed as income when you draw it, so the 4% figure above is before tax.
When you can take it
Personal and workplace pensions can usually be accessed from 55, depending on scheme rules (GOV.UK: Early retirement, checked 30 October 2026). The full new State Pension is £241.30 a week, and your own amount depends on your National Insurance record; the State Pension forecast service shows yours and your State Pension age (GOV.UK: The new State Pension, checked 30 October 2026).
Common mistakes
Reading the pot as if it were money now. £317,615 in 37 years will buy much less than it would now. For a rough figure at current prices, take expected inflation off the growth rate, for example enter 2.5% as the growth rate if you expect 5% growth and 2.5% inflation.
Treating 4% as a guaranteed income. It is a rule of thumb for how much to draw, not a product. An annuity, drawdown and a mix of the two pay out differently.
Forgetting pay rises. Workplace contributions are usually a percentage of pay, so they grow as you get pay rises. This calculator holds them flat, which tends to understate the pot.
How this calculator works: it adds your and your employer's contributions each month and grows the pot monthly at the growth rate minus the annual charge, then shows 4% of the final pot as a first-year income. It is a projection, not a forecast. Allowances were checked against GOV.UK on 30 October 2026, and every source is listed on our methodology page.