£600,000 pension pot: how much income does it actually give you?
£600,000 sits at the point where neither the pot nor the State Pension dominates: the State Pension provides 48–67% of income once it starts, and the bridge to 67 costs 35% of the pot retiring at 50. Both halves of the plan carry real weight, which makes the retirement age the single biggest lever — worth about £600 a year for every year you wait.
On our assumptions £600,000 clears the £32,700 the PLSA links to a moderate single-person retirement from age 59 onwards. Stop earlier than that and the same pot still works, but at a ‘minimum’ rather than ‘moderate’ standard of living.
£600,000 by retirement age
Every figure below is the highest income the pot can sustain while still lasting to age 95, net of tax and in today’s money. Pick an age for the year-by-year projection, the tax profile and the assumptions behind it.
Other pot sizes
Same assumptions, different starting pot — useful if you are still building and want to see what another £50k or £100k actually buys you.
What this means as a withdrawal rate
£600,000 draws 4.6% in the first year retiring at 50 and 5.6% retiring at 60 — either side of the 4% rule rather than far from it. This is the pot size at which conventional withdrawal-rate reasoning starts to apply properly, because the pot is genuinely being asked to last rather than to bridge.
Worth knowing what the 4% rule leaves out: it takes no account of the State Pension, which on this plan supplies 48–67% of income from 67. Applied literally to a UK pot it is therefore conservative — you can draw harder in the bridge years precisely because a second income starts later.
£600,000 reaches ‘moderate’ at age 59
£600,000 crosses from a ‘minimum’ to a ‘moderate’ standard of living at age 59, measured against the Retirement Living Standards.
That puts the better standard just barely in reach: only 2 of the 11 retirement ages on this page clear it, right at the top of the range. On £600,000 a ‘moderate’ retirement is not really a plan you can choose — it is what happens if you work almost to 60 anyway.
The practical reading is that £600,000 is a ‘minimum’ pot with an edge case attached. If moderate is the target, the honest options are a larger pot or a later finish than you were probably planning — not a tweak to this one.
Tax is the binding constraint at this size
Across the ages on this page, £600,000 pays between £149,000 and £243,000 in income tax over the whole plan, and some years cross into the higher-rate band. That is not a rounding error against the pot itself, and unlike growth it is substantially within your control.
Three levers move it. A quarter of each pension withdrawal is tax-free, so the order you draw wrappers in changes the bill; the years before the State Pension starts have an unused personal allowance in them that is gone if you do not use it; and once the State Pension arrives it absorbs most of that allowance permanently, so income deferred into those years is taxed harder than income taken before them. Our calculator prices all three against your actual numbers.
Your pension becomes an ISA by age 58
On the optimised plan the SIPP inside £600,000 is emptied by age 58 — 8 years of retiring at 50 — and the ISA grows to £430,162 over the same period. The pot is not running out: the money is moving wrapper to wrapper, and the reason is tax.
In the years before the State Pension starts you have a personal allowance and a basic-rate band doing nothing. Drawing the pension down then — faster than you need to spend it, and re-sheltering the surplus in an ISA — uses that allowance while it is free. Leave the money in the SIPP instead and it is still taxable later, except that by then the State Pension has absorbed the allowance and every pound is taxed from the first. At £600,000 the SIPP is too large to move in one or two years without pushing into a higher band, so the plan spreads it over 8 — which is why the retirement age and the conversion window interact.
This is the single biggest lever the calculator finds that a spreadsheet usually misses, and it is worth £95,000 or so across the age range on a pot this size.
What the next £100,000 would buy
Going from £600,000 to £700,000 adds about £3,600 a year retiring at 50, and £3,900 a year retiring at 60. Put the other way, that extra £100,000 pays itself back as income over roughly 26 years of retirement.
Compare that with what the same effort buys through the retirement age instead: one more year of work is worth about £600 a year on this pot. On those numbers the extra saving is the stronger lever, which is unusual and specific to this pot size. See £700,000 in full →
What waiting is worth
The difference between retiring at 50 and at 60 on the same £600,000 is about £5,900 a year, or £600 per year waited. Part of that is simply funding 10 fewer years; the rest is tax, and at this pot size the tax part is the larger share.
The bridge years carry an unused personal allowance and a 25% tax-free entitlement on each withdrawal, so income taken then is cheap. Once the State Pension starts it fills the allowance on its own and further pension income is taxable from the first pound. Waiting therefore buys a shorter retirement funded more efficiently — a real gain, but a smaller one than the headline spread suggests.
Questions people ask
How much income will a £600,000 pension pot give me?
Retiring at 50, about £27,800 a year sustainably to age 95. Retiring at 60, about £33,700 — £5,900 a year more for the same money, because it funds 10 fewer years and bridges less time before the State Pension.
Is £600,000 enough to retire on?
Enough for a moderate retirement from age 59, on our model. Measured against the PLSA's £32,700 moderate benchmark for a single person, £600,000 clears it at 59 and above and falls short below that. It exceeds the PLSA minimum standard at every age shown.
How much of £600,000 does retiring early actually cost?
Retiring at 50 rather than waiting spends 35% of the pot before the State Pension even starts. The 17 bridge years are the expensive ones because your pots are the only income in them — that single figure explains most of the £5,900 spread on this page.
Does the State Pension change the picture?
Decisively at this pot size. The full new State Pension is about £11,502 a year in today's money from age 67, and it provides roughly 48–67% of income once it starts. Before it, £600,000 carries everything; after it, it only tops up the difference. That asymmetry is why retiring later stretches the same pot so much further.
Run your own numbers
This page uses one fixed set of assumptions. Your real plan has your pots, your State Pension record, DB pensions, rental income and one-off events. See it modelled year by year with a free annual check-up.
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