Questions We
Help You Answer

How much do I need to save?

Assuming you have a hypothetical Pot Size for retirement in mind. Start by entering your "Current Age", "Expected Annual Return" and "Years In Accumulation". Then enter the "Starting Amount" and the monthly contribution for each Product (Pension, ISA, GIA) you have or intend to use. They will already be populated with the global values for "Expected Annual Return" and "Duration" entered in the "Accumulation Global Parameters" section.

Then simply play around with the values of "Expected Annual Return" and "Years In Accumulation" until you get a "Projected Wealth" that is what you desire. (This is assuming you can not afford to save more per month. But you can choose to save longer or plan for a better rate of return.)

How many years do I need to save?

Assuming you have a hypothetical "Years In Accumulation and Pot Size" for retirement in mind. Start by entering your "Current Age", "Expected Annual Return" and "Years In Accumulation". Then enter the "Starting Amount" and the monthly contribution for each Product (Pension, ISA, GIA) you have or intend to use. They will already be populated with the global values for "Expected Annual Return" and "Duration" entered in the "Accumulation Global Parameters" section.

Then simply play around with the values of "Expected Annual Return" and "Monthly Contribution" (you may have multiple values across various Products) until you get the "Projected Wealth" in the desired number of years. (This is assuming you are not flexible on the duration of accumulation. But can save more or plan to obtain a higher rate of return)

How much do I need to retire? (Easier with Pro Feature "Multiple Scenarios")

In Accumulation - First, you need to start with a rough hypothetical value and per-product allocation; let's say £500K split equally between Pension and ISA. Next, enter those in the "Starting Amount" for each Product and set "Monthly Contribution" to £0 and "Expected Annual Return" to 0% (this can be done at the Global Level). This will give you the exact figure you want to test, pushed from accumulation to drawdown.

In Drawdown - Simply play around with all the values and features, e.g. ISA "Monthly Withdrawal", "Taxable Monthly Withdrawal", "Tax-Free Monthly Withdrawal", "Include State Pension", to prove that the amount you have accumulated on entering drawdown will last. We are assuming "Years In Retirement" is non-negotiable.

Finally, returning to Accumulation - Play around with all Products and their Sliders (e.g. "Expected Annual Return", "Years In Accumulation", "Monthly Contribution") to achieve the figure you have proven will last you through your retirement journey with the income and "Final Wealth" value you desire.

TIP: Many of the PRO features will make this much easier, such as multiple scenarios (these work across Accumulation and Drawdown plus being able to combine state pension, and all the Tax planning so you can draw from the correct Product at the correct time.

When can I retire?

There are many factors that affect this, such as:-

• When can you access your Private Pension(s)?
• When can you access your State Pension?
  • Have you paid the correct number of years of National Insurance?
• How many years will you spend in retirement?
• How much do you plan to need / spend each month/year?
• How long do you plan to spend on accumulation?
• The rate of return on your Wealth in Accumulation and Drawdown?
• How much Tax will you pay in Accumulation and Drawdown?

How much will I have in retirement?

This will be the combination of "Years In Accumulation" and "Expected Annual Return" with Per Product values for "Starting Amount" and "Monthly Contribution" (Note: Per product values for "Expected Annual Return" and "Duration" will override the global values).

All the above will generate the "Projected Wealth" figure, which is carried down from Accumulation into Drawdown (With the PRO Version, this is on a per-scenario basis).

How much tax will I pay in accumulation? (Solution Requires Pro Version)

Simply fill out "Gross Salary" along with the "Monthly Contribution" value for each product, and we will do the rest.

Calculating "Monthly Contribution | Tax Cost", "Yearly Contribution | Tax Cost" and the same two values for taxable Products (e.g. ISA and GIA). For the ISA, we will show how much tax it costs you to make that contribution. Contributing £10K per year to an ISA does not cost £10K, as the money will first be subject to Tax and NI, so the "Tax Cost" is a personal value depending on your gross income.

"Salary Tax" is not directly linked to any savings you choose to make into a product; it is simply the cost of Tax and NI on your salary to get the money needed to save. It is only for display purposes and does not affect how much you can plan to save/invest.

How long will my pension last?

The first easy place to look is the Final Wealth At Age ## Property. If this reads £0, this means your plan did not get you to the end of your retirement journey. So for more details, look at the Panel for Product Final Value (e.g. "Pension Final Value", "ISA Final Value"), these will either show a figure remaining at the end of drawdown or a "FAILS AT AGE ##" notice. These can and very likely will be different on a per-product basis.

You can then go in and tweak drawdown settings, or enable features, e.g. "Include State Pension" that will enable you to reach the end of the "Years In Retirement" value with money remaining, should that be your wish.

How much tax will I pay in drawdown? (Solution Requires Pro Version)

Using the "Projected Wealth" figure from accumulation, combined with the values for drawdown and features enabled (e.g., "Include State Pension"), we will create the matrix showing income for each month. From that, we will calculate the predicted amount of tax you will need to pay per year. It happens in real time for each year as you slide over the timeline because it will alter based on the income for that year (which will vary based on things like a Product being depleted or a feature reaching activation, such as receiving a state pension).

The information is displayed in the "Total Planned Income" panel, tax per month and per year. With a more detailed breakdown in the panel below that shows the per-product tax cost, again per month and year. So you can use this data to tweak your drawdown to be as tax-efficient as possible.

How can I combine my State Pension? (Solution Requires Pro Version)

Using ZWP Pro, you can enter your "S.P. Claiming Age" and use two toggles to adjust your drawdown timeline.

"Include State Pension" when enabled will add the Yearly State Pension as a monthly value to your drawdown timeline, starting at the age you set. This is "Income" and subject to Tax but not N.I. It will be used in your overall income tax calculations, so it will show a bump/increase in monthly/yearly income and, in most cases, will show a bump/increase in monthly/yearly income Tax.

"Reduce Draw with State Pension", when enabled, will smooth out your drawdown timeline by reducing the amount you draw from the taxable part of your private pension to match the value of your State Pension. From the age you start claiming your State Pension, your income and tax will not change. But you will be drawing less per month/year from your private pension with the goal to make it last longer (so it will also, in many situations, mean you need a smaller pot to start with).

How can I use my tax-free cash?

We have devoted considerable time to the UK Pension Tax-Free Cash benefit. So first, we show the amount you have to play with based on the "25% of the starting pot" value.

"All Tax-Free Day 1" - This will take the full tax-free allowance at Year 0, meaning it will not be drawn out month by month during your retirement; it will be assumed you wish to take it all immediately. See "Values at Start" where it will show as "Private Pension Drawn PA | Tax-Free" and also Tax-Free Left of £0.

"Tax-Free Monthly Withdrawal" - This slider lets you set the monthly amount you would like to withdraw from the tax-free cash. For simplicity, we assume 100% crystallisation from the start. The drawdown timeline iteration logic will attempt to provide that amount of tax-free cash per year. Once the pot can not sustain that drawdown, it will take it from the taxable pension pot (and your income will incur the appropriate tax).

The "Auto" button divides the total Tax-Free sum by the years and months you plan to be in retirement/drawdown (it puts that value in the "Tax-Free Monthly Withdrawal" box), so you can attempt to smoothly draw some tax-free cash each month/year along the timeline, smoothing out your income.

"Tax-Free Only" - This button locks the tax-free drawdown to only the Tax-Free pot; it can not start taking the shortfall from the Taxable Pension (as this can cause unplanned tax implications).