With the help of NPS Calculation, know that if you are 25 years old and invest Rs 10,000 every month, then what will be your estimated corpus on retirement in 60 years. Also, how much monthly pension can you get.
NPS Calculator: Private sector employees can also arrange pension for themselves after retirement. One of its cheapest and easiest option is the National Pension System. The sooner one starts investing in NPS, the more it will be beneficial after retirement. The first is that you will get a chance to create a big retirement fund. Along with this, you can get a substantial amount as pension every month. However, there is no guarantee of any minimum pension on investment in NPS. It will depend on your annuity amount and the expected return on it. With the help of NPS Calculation, know that if you are 25 years old and invest Rs 10,000 every month, then what will be your estimated corpus on retirement in 60 years. Also, how much monthly pension can you get.
NPS Calculator: Monthly Pension on ₹10,000 Investment
Let’s say, your plan is to retire at the age of 60. Your current age is 25 years and you invest Rs 10,000 in NPS every month. With the help of NPS Calculator of SBI Pension Fund, understand how much will be the estimated fund and monthly pension on retirement.
Monthly investment in NPS: ₹10,000
Total contribution in 35 years: ₹42 lakh
Estimated Return on Investment: 10%
Net amount on maturity: ₹3.75 crore
Annuity purchase: 40% (₹1.5 crore)
Estimated Annuity Rate: 6%
Pension at the age of 60: ₹74,958 per month
(Note: This calculation is an approximate figure. Actual figures may differ.)
If you take 40% annuity in NPS (it is necessary to keep this minimum) and the annuity rate is 6% per annum, then after retirement you will get around Rs 2.25 crore lump sum and Rs 1.5 crore will go towards annuity. With the amount of this annuity, a pension of about 75 thousand rupees will be received every month. The more you keep the amount of annuity, the more pension you will get. The responsibility of investing the amount deposited in NPS is given to the registered Pension Fund Managers by PFRDA. They invest your investments in equity, government securities and non-government securities as well as fixed income instruments.
Actually, annuity is a contract between you and the insurance company. According to this contract, it is necessary to buy an annuity of at least 40 percent of the amount in the National Pension System (NPS). The higher this amount, the higher the pension amount. The amount invested under annuity is received as pension after retirement and the remaining amount of NPS can be withdrawn in lump sum.
NPS: Additional tax exemption under 80CCD(1B)
Two types of accounts Tier 1 and Tier 2 can be opened in NPS. It consists of Tier 1 Pension Account and Tier 2 Voluntary Savings Account. Any person can open Tier 1 account but Tier-2 account can be opened only when you have Tier-1 account. The important thing in this is that the tax exemption you get on the contribution is available only on Tier-1 account.
Under NPS, under section 80CCD (1B) of the Income Tax Act, the benefit of tax exemption is available on investment up to Rs 50 thousand. NPS can also help you in extra tax savings if you have met the limit of up to Rs 1.5 lakh under section 80C. There is no tax on withdrawing up to 60% of the amount on maturity of this scheme.
(Disclaimer: There is no guaranteed pension in NPS. Here only a calculation is given. Investment or annuity returns are approximate. So consult your advisor before starting any investment.)
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