Pension Calculator UK 2025/26

Understanding UK Pensions 2025/26

A pension is a long-term savings plan designed to provide income in retirement. In the UK, most workers are automatically enrolled into a workplace pension through the auto-enrolment scheme, introduced to help people save for retirement. The earlier you start contributing, the more time your pot has to grow through compound interest.

Auto-Enrolment Minimum Contributions

Under auto-enrolment, the minimum total contribution is 8% of qualifying earnings (between £6,240 and £50,270). At least 3% must come from your employer, and 5% from you. Many employers offer enhanced contributions — always contribute enough to get the full employer match.

State Pension 2025/26

The full new State Pension is £11,502 per year (£221.20 per week) for 2025/26. You need 35 qualifying years of National Insurance contributions to receive the full amount. You can check your State Pension forecast at gov.uk.

The Power of Compound Growth

A 5% average annual growth rate is a commonly used assumption for a balanced pension fund. At this rate, £100 invested today becomes approximately £163 in 10 years and £265 in 20 years. Starting 10 years earlier can more than double your pension pot at retirement.

Annual Allowance and Tax Relief

The annual allowance for pension contributions is £60,000 for 2025/26 (or 100% of your earnings, whichever is lower). Contributions receive tax relief at your marginal rate — meaning a 20% taxpayer effectively contributes only 80p for every £1 in their pension, and a 40% taxpayer only 60p.