How to calculate how much pension I need

D3V!L

I'm a little late to the pension game at the age of 42 due to other work and commitments. Any pension calculator I'm looking at is telling me that I should aim for 50% of my salary at retirement. How would I know what my retirement salary is !!

What's the general consensus?

sonyvision

How long is a piece of string, I put away 20% of my salary and if by the time I retire I draw down 40k in today's money without any kids or mortgage I could survive on that very easy. Put in your max amount your allowed for tax relief would be a good starting point.

Theres no magic formula, the idea being that by the time you retire you might be at a stage where your major outgoings have dwindled somewhat.

Half-final-salary is shorthand for that, essentially.

What would you imagine your final couple of years salary will look like? Pick a figure and go from there, its only a rule of thumb anyway

Henry Ford III

Take your current salary and index it at an assumed rate of inflation.

Not very scientific but it's as good as you'll get.

homewardbound11

I think the figure roughly to aim for is 600-800k pot and with that it should get you a pension of 32k a year and add if there is one a contributory pension from the government of 12k and your. E in a good way .

Still Clueless

I was looking at this about a month ago and came across an article which is UK based but highlighted some of the factors to consider which I thought was a good starting point.

https://www.which.co.uk/money/pensions-and-retirement/starting-to-plan-your-retirement/how-much-will-you-need-to-retire-atu0z9k0lw3p

Lots of variables will impact your needs - what type of retiree you will be, rent/mortgage status, how many people do you need your pension to cover, do you want to maximise your tax relief, what can you afford to put into a pension etc.