## Use our Retirement Calculator to calculate how much you need to save for retirement

### How much money will you need to retire comfortably?

Our retirement calculator, below, helps you to calculate quickly how much you need to save for a comfortable retirement using an average rate of return of 7 per cent annually.

Unfortunately, too many people wait until much too late in life to begin planning for their retirement "budget." Even those who take the time to ponder their options at a young age still often fail to consider such important variables as inflation, interest rates and dividend returns.

### Suppose a retirment income of £36,000 per annum will do

When you retire, (hopefully) you’ll have State Pension. For our example, let’s assume you are entitled to State Pension totalling approx £7,000 per annum. You're therefore £29,000 short in order to meet your annual income needs.

So, how much do you need to save for a comfortable retirement?

The next step is for you to decide how mouch money your assets will need to generate - for instance 7 per cent, per annum (say from interest income or from dividends yielding 7 per cent on average per annum).

Using 7 per cent might seem like a high number right now. Interest rates are much lower now, though there are still a few solid 7 per cent dividend payers out there.

It’s also not reasonable to expect that interest rates will remain this low over the remainder of your life. But 7% over long terms, I doubt it.

Anyway in the

### Retirement Calculator

below, I have pre-set your expected annual return at 7 per cent. You now just need to insert the amount you require per annum.

Remember our example, above - we need £29,000, so insert 29000 and then click: calculate

## Retirement Pot Calculator

 Use our simple Retirement Calculator and find out how much money you will need to have when you retire in order to secure the amount of money you would like to live on when you retire.

 Click: Calculate Amount required at retirement*: £
*Assuming 7% interest or dividend yield, per annum

Let's do the math behind this calculation . . .

Take the £29,000 and divide it by the pre-set annual return of seven per cent. Just take the £29,000 and divide it by 7% – you get £414,294 - (multiply 29000 times 14.286).

Result?

At retirement, you need to have at least £414,300, and, then you need to generate an annual return of at least 7 per cent (over the long run) in order to earn £29,000.

You now know that your target amount is almost £415,000

Are you shocked?

I am sorry, I am not trying to scare you! But this is for real!

You can do several things now, including:

1. run the retirement calculator again, using another amount, say £25,000 or £20,000, instead of £29,000
2. decide that the return you’ll be able to earn on your investments will be higher than 7 per cent per annum, on average
3. start a dividend growth stock portfolio in your stock and shares ISA. For instance £100,000 in dividend paying shares yielding 4% today and growing at 7% per annum, generate £16,000 in annual tax free income in 20 years from now

4. click below for some of our other retirement calculators operating at different annual returns, including:

• 5 per cent
• 6 per cent
• 8 per cent
• 9 per cent
• 10 per cent

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