NPS scheme : If you also want to get an income of up to Rs 1 lakh every month after retirement, then NPS is a good option for you, but on how much investment will you get a pension of Rs 1 lakh, let’s check the calculation here.
NPS Calculator: If you want a tension free life after retirement, then you will have to plan for it from now. As we all know that there are fair expenses during retirement. To meet these expenses, you must have a monthly income source.
If you have not done retirement planning yet, then the Central Government’s National Pension Scheme (NPS) is the best option for you. With the help of this scheme, you can raise adequate funds for your happy retirement.
How to get pension of one lakh rupees per month from NPS?
Suppose you want to get a pension of Rs 1 lakh every month. So we will tell you how much you will have to invest every month in NPS. Now suppose your age is 25 years, then you will get the period to invest in this scheme for 35 years. We are using SBI Pension Fund’s NPS Calculator for this calculation.
- Investment per month in NPS: Rs 12,000
- Total investment in 35 years: Rs 45 lakhs
- Expected return: 10 percent
- Total amount on maturity: Rs 4.5 crore
- Annuity: 45% (Rs 2.0 crore)
- Estimated annuity rate: 6 percent
- Pension at age of 60: Rs 1.07 lakh per month
What is annuity in NPS?
If you are investing in NPS then you are required to take 40 percent annuity. You get pension every month only from the annuity amount. In the calculation we have done, 45 percent annuity has been taken, the rate of which is 6 percent. That means 45 percent of the retirement fund will go into annuity.
The more annuity you keep, the more pension you will get. It is necessary to take 40 percent annuity in NPS. Investing in NPS also provides tax deduction benefit of up to Rs 50,000 under Section 80CCD(1B) of the Income Tax Act.
