Shortfall between current pension path and target at retirement

Why the Gap Is Usually Invisible

Pension statements show today's pot and projected pot at retirement. They rarely frame the gap against a specific target. A 45-year-old with a 80,000 pot and 400/month contribution projects to roughly 380,000 at 65 (at 5% real return). If the target for a 30,000/year retirement income is 750,000, the gap is 370,000 — nearly double the projection.

Closing the Gap

A 370,000 gap over 20 years requires roughly 940/month extra contributions at 5% return — on top of the existing 400. That is a significant ask for most households. The alternatives are extending retirement by 3-5 years or reducing the target income. The calculator makes the trade-off concrete.

What Target to Use

And planning uses a 4% safe withdrawal rate as a common heuristic: target pot equals annual spend divided by 4%. A 30,000/year target implies 750,000. A 45,000 target implies 1.125M. Lifestyle and state pension estimates change these numbers; treat the output as a rough planning figure.

Run it with sensible defaults

Using current pension pot of 80,000, current monthly contribution of 400, years to retirement of 20, target pot at retirement of 750,000, the calculation works out to approx 370k shortfall. Nudge the inputs toward your own situation and the output recalculates instantly. The defaults are meant as a starting point, not a recommendation.

The levers in this calculation

The inputs — Current Pension Pot, Current Monthly Contribution, Years to Retirement, Target Pot at Retirement, and Annual Return — do not pull with equal force. Not every input has equal weight. Flip one at a time toward extreme values to feel which ones move the needle most for your situation.

How the math works

Projected pot equals current pot compounded plus monthly contributions as annuity. Gap equals target pot minus projected pot. Extra monthly required uses annuity inversion to close the gap. Results are estimates for illustration purposes only. The working is transparent — you can verify every step yourself in the formula section below. No black box, no opaque "proprietary model".

Using this to recalibrate

Repeat the calculation with smaller inputs to see how much the final figure moves. That sensitivity is where the actionable insight lives — often a modest change today produces a dramatically different lifetime total.

What this doesn't capture

This is an illustration, not a prediction. The specific figure depends entirely on your inputs — change any assumption and the headline moves. The value is in the pattern it reveals, not the exact pound figure.