Personal Pension Calculator

Introduction

Pension is a regular payment made during a person's retirement from an investment fund to which that person or their employer has contributed during their working life. The Personal Pension Calculator estimates the amount of money one will have at retirement when saving their money with a pension organization. It uses variables such as the income, accrual rate and duration in the formula, which are standard and generally used by all pension organizations when calculating pension. The calculator is simple and anyone with basic Mathematics and English knowledge can use it. The calculator can help with planning for future savings and it is suited for any income earning individual who is looking to plan for their retirement savings.

Formula and Equation

When using the calculator, it is important to note that the resulting amount is an estimate therefore slight deviations are expected depending on additional variables used by your pension organization. The formula used to calculate pension is as shown below.

pension= Income amount ×Accrual rate(%) ×pension duration

Variables used in the equation

Various variables are required by the calculator for the complete pension amount to be calculated. These variables are the actions that are inputted and they are listed below.

• Income
• Duration
• Accrual rate

Income. Income are the total annual earnings or salary from which pension savings are calculated. You can calculate your annual salary from hourly wage [Private Equation]

Duration. The duration is the time period in years for which income is saved for pension.

Accrual rate. The accrual rate is the percentage interest applied to the income or salary by the pension organization and it determines the amount of money that goes to savings.

References

https://www.lexico.com/definition/pension

Capital, A. B. (2019, December 7). How to Calculate Pension Under EPS (Employees Pension Scheme)? Retrieved from aditya birla capital: https://www.adityabirlacapital.com/abc-of-money/calculate-employee-pension-scheme