Retirement Planning

The 4% Rule

The 4% rule suggests withdrawing 4% of your retirement pot annually — this has historically allowed a portfolio to last 30 years in most market conditions. A £500,000 pot provides £20,000/year at 4%. This is a starting guide, not a guarantee.

State Pension

UK state pension (2024): £11,502/year for full entitlement (35 qualifying NI years). This should be added to your private pension income calculation. Check your state pension forecast on the government website.

Inflation in Retirement

A pension income that feels comfortable at 65 may not at 85. Build in annual increases — most annuities and pension drawdown strategies should account for 2–3% annual increases to maintain purchasing power over a 25–30 year retirement.

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