NPS Calculator: Everyone’s wish is that post-retirement life should pass smoothly without any stress. Always have money in your pocket to meet your needs and for everyday expenses.
That’s why it is necessary that the source of monthly income should remain. So whenever we start our job or employment, start planning for retirement along with it. Thinking of retirement planning, especially when you are in private job, then National Pension System is a good option. This is because it can create a big retirement fund. Along with this, you can also get monthly pension. Also, NPS is the cheapest pension product.
NPS Calculator: Planning ₹ 1 Lakh Monthly Pension
Let’s say your plan is to retire from your job or profession at the age of 60 and get a pension of Rs 1 lakh every month after that. You have chosen NPS for your retirement plan. Here it is important to know that how much should be invested every month so that after retirement, a pension of at least one lakh rupees comes. Let us understand with the help of NPS Calculator of SBI Pension Fund. Suppose you are 21 years old and you want to retire in 60 years. In this way, you will get a total investment period of 39 years for projected retirement planning. See calculation.
Monthly investment in NPS: ₹10,000
Total contribution in 39 years: ₹46.80 Lakh
Estimated Return on Investment: 10%
Net amount at Maturity: ₹5.62 Crore
Annuity Purchase: 40% (₹2.25 Crore)
Estimated Annuity Rate: 6%
Age 60 Pension on: ₹1,12,458 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 Rs 3.37 crore lump sum and 2.25 crore will go to annuity. Now with this annuity amount, you will get a pension of about Rs 1 lakh 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.
NPS: It is necessary to take 40% annuity
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.
Let us tell you, under Section 80CCD (1B) of the Income Tax Act under NPS, the benefit of additional tax deduction is available on investment up to Rs 50 thousand. If you have met the limit of up to Rs 1.5 lakh in section 80C, you can avail this additional tax benefit.
(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.)
