How the app calculates
Traceable instead of a black box: this page shows the formulas, assumptions and colours behind every number in the app, with the same charts as in the app itself. It is not a calculator of the Deutsche Rentenversicherung and does not replace your Renteninformation. For the pension you have actually earned, your own Renteninformation is what counts.
Statutory pension
The statutory pension follows a fixed formula set by law:
Pension points (Entgeltpunkte) you collect for every contribution year: 1 point equals an annual salary at the level of the average earnings of all insured people. Earn twice the average, and you get 2 points that year; earn half, 0.5 points.
42.52 € per point (since July 2026, uniform nationwide)
51,944 € (reference for 1 pension point)
1.0 for retiring at 67 (no deductions); lower for retiring from 63 with deductions
1.0 (old-age pension)
From gross to net
The app also shows the net pension: from the gross pension, pensioners' health and care insurance is deducted (roughly 12%, depending on the health fund, the additional contribution and whether you have children), then your individual income tax at your own rate. The chart below shows an example with approximate amounts.
Figures are examples to illustrate the order of magnitude, not a forecast for your case.
Your needs in retirement
The gap is needs minus net pension. Your needs, that is how much you require each month in retirement, are a personal figure, not a fixed number. For this the app offers two ways, instead of just one flat percentage rule:
- Simple: a percentage of your current net income (the common rule of thumb of around 80%). Fast, but rough.
- Detailed: you start from your actual monthly spending and subtract what falls away in retirement (for example a paid-off loan, the savings rate you no longer set aside, or grown-up children), plus a safety buffer. This gives a more realistic figure than a flat percentage.
That way you see not just a rough ratio, but concretely how much you really need per month.
The pension gap over time
Needs and the statutory pension develop differently: your needs in retirement rise with the inflation you assume, the statutory pension grows with the annual pension adjustment. If inflation is higher than the pension adjustment, the gap widens year by year.
How long the pension has to last you set yourself through the assumed life expectancy (in the example up to age 87); that gives the period shown in the chart.
Illustrative curve. Slopes depend on the inflation and pension adjustment you assume.
The gap matrix
Instead of a single number, the app shows a matrix: each row is a return scenario for your savings plans, each column a possible annual pension adjustment. Each cell shows how much surplus you have left at the end of the month or how much you are short, in today's purchasing power.
The star ★ marks the reference scenario: a realistic return combined with +2% pension adjustment per year, close to the historical average.
− = you are short · + = you have left over (€/month, today's value)
Today vs nominal
A euro in 30 years buys less than a euro today. By default the app therefore discounts all future amounts back to today's purchasing power: 4,000 € nominal in 30 years corresponds, with the assumed inflation, to only around 2,200 € in today's money. This makes amounts across different periods comparable and is more realistic for planning. If you prefer to look at the amount actually paid out, you can switch to "nominal" at any time.
Three tax regimes
Ways of saving for retirement are taxed differently in Germany. The app distinguishes three regimes:
- ETF savings plan: flat capital-gains tax (Abgeltungssteuer) of 26.375% (including the solidarity surcharge) on the gains, after a 30% partial exemption for equity funds. Only the increase in value is taxed, not the capital you paid in.
- Private pension insurance: when paid out as a pension, only the so-called income share (Ertragsanteil, an age-dependent percentage) is taxed at your personal marginal rate, not the full pension.
- Riester (existing contracts) / Altersvorsorgedepot: deferred taxation, meaning the payout is fully taxed in retirement at your income-tax rate then (or the income share above the state subsidy).
Rented property
The app treats a rented property as its own income source for retirement: the net rent after tax and running costs feeds into the pension gap.
- Tax: rental income counts as income and is taxed at your marginal rate. Deductible items include the building depreciation (AfA) and the loan interest, which lowers the tax burden.
- Purchase: one-off buying costs (property transfer tax depending on the federal state, notary, land registry, and possibly an agent). With a loan the leverage kicks in; interest is deductible, the principal repayment is not.
- Sale: a gain is tax-free after a 10-year holding period (speculation period, §23 EStG).
- For the pension gap what counts is the rent you have in retirement, not today's: while the loan is still running it is lower at first and higher later. The app forms an average of it across your retirement years.
- Running costs: a maintenance reserve, management and a rent shortfall (vacancy or non-payment) are taken into account as a deduction from the rent.
A real property purchase is more complex than a model can capture. Only simplified or not covered at all are, for example, larger irregular renovations, tenant and legal risk, the low liquidity, the concentration risk (a lot of wealth in one object), the interest-rate risk on refinancing after the fixed-rate period, regional rent trends and the selling costs. Use this part for scenarios, not as an exact return forecast.
Example figures. If the loan still runs into retirement, the rent is lower at the start; the app shows the average.
Assumptions & limits
The statutory part of the calculation follows the official formula and is solid if your inputs (pension points, retirement age, contribution years) are correct. The projection over 20 to 40 years, on the other hand, depends on assumptions you set yourself: salary growth, the return on your savings plans, your tax rate in retirement and inflation. Small changes to these assumptions can shift the result significantly over such long periods. That is why the app deliberately shows several scenarios instead of a single forecast number.
The app compares categories of retirement provision (statutory pension, ETF savings plan, private pension, Riester (existing contracts), rented property), not specific products or providers. It is not financial, tax or legal advice.
Note
All results are non-binding projections based on your own inputs and simplified, general assumptions. They can differ considerably from the actual outcome. No guarantee is given for accuracy, completeness or timeliness. For details see the disclaimer.