Pension Calculator
Estimate a defined-benefit pension from final salary, years of service, and the plan accrual rate. Free annual and monthly pension calculator.
Independently verified for accuracy
- Annual pension
- 48000
- Monthly pension
- 4000
This calculator estimates the starting annual and monthly income from a defined-benefit pension based on your final salary, years of service, and the plan accrual rate. Use it to project retirement income from an employer or public pension before you commit to a retirement date. It gives the base benefit, before any cost-of-living adjustments.
How this is calculated
It uses the standard defined-benefit formula, annual pension = final salary times years of service times the accrual rate per year, then divides by 12 for the monthly figure.
How to use
- Enter your final or final-average salary.
- Enter your years of service and the plan accrual rate per year.
- Read the estimated annual and monthly pension.
Examples
- $80,000, 30 yr, 2% accrual:
$48,000/yr, $4,000/mo - $65,000, 20 yr, 1.5% accrual:
$19,500/yr, $1,625/mo
FAQ
- How is a defined-benefit pension calculated?
- Most plans use final (or final-average) salary times years of service times an accrual rate per year. A 2% rate over 30 years replaces 60% of salary.
- What accrual rate should I use?
- Check your plan documents. Public pensions often use 1.5% to 2.5% per year. The exact rate, salary definition, and any cap are set by your specific plan.
- Does this include cost-of-living increases?
- No. The estimate is the starting pension. Many plans add annual cost-of-living adjustments, which this simple formula does not project.