Answers · UK 2025/26
How much do I need to save for retirement if I start at 40?
Starting at 40, a common rule of thumb is to save around 20% of your salary to build a comfortable pot by 67. For a £35,000 earner that is roughly £580 a month including tax relief and employer contributions, aiming for a pot of about £400,000 to £550,000 alongside the State Pension.
Full answer
Starting a pension at 40 means about 27 years of saving to State Pension age 67, so you need a higher contribution rate than someone starting in their twenties. A widely used guideline is to halve your age when you start and save that percentage of salary — so 20% at age 40. Worked example: a £35,000 earner saving 20% sets aside £7,000 a year, but much of that comes from tax relief and employer contributions. If you personally pay 8%, your employer adds 5% and tax relief tops it up, the net cost from your take-home is closer to £580 a month. Assuming roughly 5% annual growth after charges, contributions of around £7,000 a year for 27 years could build a pot of approximately £400,000 to £550,000. Combined with the full new State Pension of £241.30 a week (about £12,548 a year), that supports a moderate-to-comfortable retirement. Retirement living standards suggest a single person needs about £31,300 a year for a moderate lifestyle. The 25% tax-free lump sum and the power of compound growth reward starting now rather than waiting. These figures apply UK-wide. Use the Pension calculator to model contributions and projected pot size.
Try the calculator
More answers
This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.