Current age determines compound-growth runway. Target retirement age is when you'll start drawing pension — minimum is age 55 (rising to 57 from 2028), state pension age varies by birth year.

The years between determine how much compound growth dominates your projection. A 25-year-old has a 42-year window to retirement — opt-out cost is enormous. A 60-year-old has 7 years; opt-out cost is much smaller.

Enter gross annual salary. The tool calculates qualifying earnings: earnings between the lower threshold (£6,240) and upper threshold (£50,270 for 2025/26). Auto-enrolment minimums apply to this band, not full salary.

Higher earners often have employer schemes that exceed minimums — enter your actual employer match percentage if known. The defaults are statutory minimums (3% employer + 5% personal).

Default 5% personal contribution is the auto-enrolment minimum. Many employees ramp this to 8–10% to maximise employer match (often capped at 5–6% from employer side).

Employer match: 3% is the legal minimum but check your scheme docs. NHS pension is 23.7% employer (career-average DB). Civil service 27%+ DB. Big-tech and finance often 10–15% DC. The free-money rate matters massively.

Default assumptions: 5% expected annual return (real, after inflation), 0.5% annual charges. These are FCA-recommended baseline projections. The tool also offers conservative (3%) and optimistic (7%) scenarios.

Charges matter: a 1.5% TER fund vs 0.25% index fund costs over £100,000 in fees over 30 years on a £200k pot. Workplace pension default funds are typically 0.3–0.75% — usually lower than retail SIPPs.

The hero card shows your projected pension pot at retirement age, the equivalent annual income (using ONS life-expectancy and standard annuity rates), and the "what-if-you-opted-out" counterfactual (same contributions invested privately without employer match).

The gap between the two — typically 50–100% larger pension with employer match — is the lifetime cost of opting out.

Use the Breakdown tab to see year-by-year contributions, employer match value, tax relief and projected balances. The Growth Chart visualises pension pot vs counterfactual investment over time.

Decision rule: if you can afford the contribution AND your employer matches, almost never opt out. The rare exceptions: extreme short-term liquidity crisis (debt repayment > pension contribution rate), or planned imminent emigration where pension recovery is complex.

Auto-enrolment statutory minimums (3% employer + 5% personal) are calculated on qualifying earnings, not gross salary. Qualifying earnings = earnings between the lower threshold (£6,240) and upper threshold (£50,270 for 2025/26).

Worked example: £40,000 salary. Qualifying earnings = £40,000 − £6,240 = £33,760. Statutory employer minimum: 3% × £33,760 = £1,012.80/year. Statutory personal minimum: 5% × £33,760 = £1,688/year (gross).

Many employer schemes use "pensionable salary" definitions that include the lower band (better) or full salary (best). Read your scheme rules — the difference is £200–£500/year in employer contribution at typical UK salaries.

Two main pension tax-relief methods exist in UK workplace schemes:

• Net-pay arrangement: contribution comes out before tax. £100 contributed reduces taxable income by £100, saving £20 (basic) or £40 (higher) tax automatically. Most public-sector schemes (NHS, civil service, teachers).
• Relief-at-source: contribution comes out of net pay. Provider claims back basic-rate relief. Higher-rate taxpayers must reclaim further 20% via Self Assessment. Most workplace DC providers (Aviva, Scottish Widows, Royal London).

For low earners below personal allowance (£12,570), net-pay schemes give NO tax relief, while relief-at-source still gives 20%. The "low earner anomaly" was partially fixed by HMRC top-up payments from 2024/25 but isn't automatic — affected workers must apply.

If your employer offers salary sacrifice for pension contributions, it's materially better than the alternatives:

• You save income tax (20%/40%/45%) AND National Insurance (8% main rate, 2% above £50,270)
• Employer saves NI (13.8%) — many employers pass some/all back to you as additional pension contribution

Total benefit for higher-rate taxpayer: 40% tax + 2% employee NI = 42% saving on £100 sacrificed (vs 40% with relief-at-source). With 50% NI sharing, employer contributes extra 6.9% — total benefit 48.9% on £100.

Salary sacrifice reduces your "salary" for mortgage affordability, statutory maternity pay, life cover linked to salary, and state benefits. Most lenders gross back up; check if a key driver. Cannot reduce salary below National Minimum Wage.

Three scenarios where temporarily opting out can be defensible (not optimal — defensible):

1. High-interest debt: Credit card debt at 25% APR vs pension expected 5% real return. Pause pension, blitz debt for 12–18 months, opt back in via re-enrolment. Lost employer match ~3–6 months of foregone contribution.

2. House deposit shortfall: If a £10k pause for 24 months unlocks a 90% LTV vs 95% LTV mortgage, the rate improvement (~0.4–0.6%) plus saved CMI could justify temporary opt-out. Only if you'll genuinely complete the purchase.

3. Imminent emigration: Moving to a country with restrictive UK pension recognition (USA, some Asia-Pacific) makes UK pension less valuable. Shifting to a portable structure (ISA + emigration-friendly investment) may be sensible — but seek cross-border financial advice.

In all cases: opt back in at first opportunity. The 3-year auto re-enrolment is your safety net.

The 2025/26 full new State Pension is £230.25/week (£11,973/year). To qualify you need 35 years of National Insurance contributions; partial pension on 10–34 years; nothing on under 10 years.

Even with full State Pension, modal UK retirees need £25,000–£35,000/year for "moderate" retirement (PLSA Retirement Living Standards). Workplace pension fills this gap — opt-out leaves you 100% reliant on State Pension at far below moderate income.

Plan for State Pension to be one component of three: State + workplace pension + ISA/private investment. Opting out of workplace pension cuts that to two components and concentrates risk on State Pension policy continuity over 30+ years.