Pension sites often quote "Use our pension calculator to estimate the amount of pension income you could get when you retire. This will help you decide how much you need to save to get the retirement income you want."

The only trouble is I can't seem to decide how much I want or need.

Presuming that I've paid off my mortgage, I would need enough for my wife & me for food, heating, utilities and some spending money.

Does anyone have a good general rule for what my pension pot should be please?

I live in the UK.

  • Not sure if you guys get the PNG commercial, but "a million gazillion" is a good start :)
    – BlackJack
    Aug 2, 2011 at 15:21
  • In addition to the many suggestions below, just be aware that many retirees spend more in the first few years of their retirement, per year, than they were spending pre-retirement. This comes as a huge shock to a lot of people.
    – gef05
    Aug 2, 2011 at 17:24
  • You age when you start saving as a percentage of your take home income until you retire.
    – xvk3
    Feb 10, 2018 at 12:10

3 Answers 3


One rule of thumb I've seen is that you want an amount large enough that you can pull 4-5% from it per year to meet your needs. That seems to be seen as a withdrawal rate that could largely be made via a combination of dividends on stocks and interest on fixed income, and thus be maintained relatively indefinitely.

In addition to what you listed, don't forget Travel (unless you plan to just stay at home) Taxes (on property, etc), and to allow for some level of inflation (e.g. what things are costing you now, will be less than what it will be in 10 or 20 years from how) Also budget for Medical expenses (which will of course be different in different parts of the world) or perhaps some kind of assisted living/care arrangement when you are older.

  • Good answer. Remember to include any Government retiremt pension as well. As an example, inthe US, a $40K earner might see a social security payment of $20K. So, the amount needed for 80% replacent is $12K, and only $300K needed in his other savings/pension. Jul 10, 2013 at 0:40

For a rule of thumb, the minimum going into all your savings combined should be 15%, but really...if you can afford more, go for it!


You should add up all your expenses, then use an inflation calculator to calculate how much that number will increase by the time you retire, then multiply that by the number of years you expect to live in retirement (based on average life expectancy, etc).

You can see from that short explanation that there are a lot of assumptions you're going to make. If you knew your exact death date, it would be easy, but that's unrealistic.

Alternatively: take your current household income, multiply it by 10. Use that number as the amount you would need in order to live in retirement indefinitely (given a decent rate of return on your investments)

  • Starting with "your current household income" doesn't take into account how much you might (or might not) be saving as a percentage of your income. You really should focus on what you're spending and will be spending in retirement. You should also take into account how your taxes will change (e.g. you won't be paying FICA in retirement.) Aug 4, 2022 at 20:56

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