A projection may assume that contributions rise with salary or inflation every year. If the debit order actually stays flat, the future balance falls behind even when the return assumption is met.
Retirement projections often focus on investment return, but contributions are one of the inputs you can influence most directly. The amount invested now, the frequency of contributions and future increases can materially change the result. Career breaks, irregular income and employer contribution changes also need to be reflected.
The quoted contribution may include more than retirement saving, too. In an employer fund, part can fund risk benefits and administration. In a personal product, advice or product charges may affect how much reaches the investment.
Try this now
Compare the contribution in your latest projection with the amount actually invested over the last three months. Record the assumed annual increase and the next date it should occur.
Ask your advisor
- Is the contribution shown before or after costs and insured benefits?
- What annual increase has been assumed?
- How does the result change if contributions pause, stay flat or rise?
Contribution assumptions should describe a behaviour you can recognise and review, not an invisible source of optimism in the model.