Pension Calculator
Estimate your defined-benefit pension based on years of service, average salary, and accrual rate.
A defined-benefit pension provides a guaranteed monthly income in retirement, calculated using a formula based on your service history and salary. This calculator estimates your pension using the standard formula: Years of Service x Average Salary x Accrual Rate.
The accrual rate (also called the benefit multiplier) determines how much pension you earn for each year of service. Common rates range from 1% to 2.5% per year. Government employees often receive 1.5-2%, while some generous plans offer up to 2.5%.
The average salary used in the formula is typically the average of your highest 3-5 years of earnings, sometimes called "final average salary" or "high-3" or "high-5" depending on the plan. This rewards employees whose salaries grow over their careers.
The replacement ratio shows what percentage of your salary the pension replaces. With 25 years of service at a 1.5% accrual rate, your pension replaces 37.5% of your average salary. Financial planners generally recommend a 70-80% total income replacement rate in retirement, so additional savings are usually needed.