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Japan: low assumed inflation, and a pension you can defer

The kosei nenkin and kokumin nenkin provide most Japanese retirement income and are not modelled here. The public pension is payable from 65, with deferral available to 75, and that deferral is a real lever: putting the start date back raises the monthly amount permanently, which is the one decision that can shrink the portfolio you need without saving another yen. If you plan to defer, the income this page has to produce is larger in the gap years and smaller afterwards.

Japan also carries the lowest assumptions on the site, and that changes how the chart behaves. The defaults are a 5% nominal return and 1% inflation, a real return of 3.96% a year, which is not far off countries assuming much larger nominal numbers, because inflation is doing so much less damage here.

The visible consequence is that the nominal and today's-money lines stay close together. Over 35 years, 1% inflation divides a balance by 1.42; at the 5% some countries on this site assume, the divisor would be 5.52. Elsewhere the gap between the two lines is the whole story. In Japan it is narrow, and almost all of the result rests on the return assumption instead, which is the number to stress-test.

For how the calculation works, the formula behind it and what it leaves out, see the full guide.

Data sources

  • Japanese consumer finance conventions

    Effective 2010-06-18 onward · retrieved 2026-08-30

    The interest ceiling steps down as the balance rises: 20% below 100,000 yen, 18% to a million, 15% above.

    How we checked these figures

    The Interest Rate Restriction Act sets a ceiling of 15% to 20% depending on the principal.

    Current

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Each country has its own rates, thresholds and rules, and its own page with the official sources they came from.

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