Rs 1 lakh Pension Per Month By Investing In NPS? Check Pension Calculator

NPS mutual funds are market-linked wherein you earn a compound interest. The early one starts, it increases the chances of better returns at maturity.

National Pension System (NPS) is a voluntary contribution pension scheme in India, overseen by the Ministry of Finance, managed by the Pension Fund Regulatory and Development Authority (PFRDA). Many people do not start their retirement plan at an early age, thinking there is a time for retirement. However the more you delay the retirement fund the chances of you getting less money available in your hand post retirement are more.

What IS NPS?

If you plan in advance, NPS is one of the efficient ways to boost your retirement income. It also helps you to save tax. NPS voluntary model is available to all the citizens of India including those residing abroad, between the age of 18 and 70 years.

NPS Tax Saver:

One can save tax up to 1.5 lakh under 80C and an additional 50,000 under 80CCD(1B). Under 80CCD(2).

NPS mutual funds are market-linked wherein you earn a compound interest. The early one starts, it increases the chances of better returns at maturity.

Who can earn 1 Lakh Pension Per Month Through NPS Investment?

Investors who are 25-year-old or below and start a retirement plan can earn a Rs 1 lakh a month pension at age 60, considering they meet all the conditions. Returns from NPS will depend on the amount you invest, number of years, your age, from when you start your investment.

To earn 1 lakh pension it should also meet below criteria

• Assume an annualised average return of 8 per cent on the NPS investment through the whole period. (Subject to change as its market linked scheme)
• Individuals start investing in NPS at age 25.
• Individuals continue the investment until the retirement age of 60 i.e. total a period of 35 years.

NPS Pension Calculations:

Age: 25 years

Retirement age: 60 years

Total contribution: 35 years

Expected return: 8%

Would like to purchase an Annuity for 80%

Total Investment: Rs 34,23,000

Total Corpus: Rs 1,88,19,777

Total Gain: Rs 1,53,96,777

Per month Investment Rs 8,150 from age 25 to 60.

If all the above criteria are met, then it can generate an expected pension of Rs 1,00,228 per month.

(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. NPS investments are subject to market risks. Do consult your advisor before investing anywhere.)