NPS: Get monthly pension after retirement

NPS (National Pension scheme): Get monthly pension after retirement. Do you want to spend your old age relaxing and sitting on a chair with a book in your hand? If yes, then it is very important for you to start planning for your retirement now. One can start planning for retirement from the day you get your job. The more you delay, the more the investment amount will increase.

Everyone wants to have a stable future after they retire. There are numerous types of investments accessible for this purpose. The National Income System, NPS is one of them, and it can provide you with a monthly pension of Rs 50,000 after you reach the age of 60.

One of the best schemes in the current retirement scheme is New Pension System (NPS). It is safe and will give you good returns. By investing in this scheme, you can get pension of up to Rs 50,000 every month after retirement. NPS allows you to be financially self-sufficient even in old age. This is a government-sponsored scheme that pays out more than 10%. It’s one of those schemes that promises a large profit while posing little risk.

monthly pension after retirement
Name of the pensionNPS Pension
TitleGet monthly pension after retirement
SubjectGet monthly pension after retirement
NPS CalculatorPensioners Portal Pension Calculator
NPS CalculatorNPS-Pension-Calculator
NPS CalculatorPension-Calculator
SBI NPS CalculatorNPS-Calculator
Details of Pension Calculator

Retirement planning, How much should you invest in NPS every month to get Rs 1 lakh pension? Over the years, the PFRDA, the regulating body of pension funds in India, has been making several rule changes in the scheme to make it attractive for retail investors. It is a hybrid investment scheme (that invests in both equity and debt) so experts say it can help young earners accumulate a large corpus for their retirement by investing smaller amounts every month.

By investing in NPS you will get a fixed monthly pension till you are alive and also a lumpsum amount at the time of retirement. A subscriber can withdraw maximum 60% of his maturity corpus from NPS as a tax-free lump sum amount and with the remaining amount he/she has to buy an annuity from a life insurance company, which on average give annuity income at an annual rate of 5-6% if you choose return of premium option.

NPS gives you multiple fund options where you can choose between a mix of debt and equity where the maximum equity component can not exceed 75% of the investment amount. According to financial planners, one can expect 10-11% annual return in the longer term if he allocates 75% of his investment in NPS to equities and 25% to debt.

So if you start investing early, as soon as you get a job, let say at the age of 24, when most people start working, in NPS then you can easily accumulate a retirement corpus of over Rs 5 crore (Check NPS calculator below) by your retirement age (60 years) by investing just Rs 300 a day or Rs 12,000 monthly. Out of the retirement corpus, you can withdraw 60% or Rs 3.05 crore as a lump sum and the remaining 40% or Rs 2.04 crore needs to be used for purchasing an annuity. Assuming 6% annuity return, you will get Rs 1 lakh monthly pension after your retirement.

Previously, only government employees were eligible for this pension programme. The government, on the other hand, has now made it available to the general public. Any Indian citizen can benefit from this new pension system if they meet certain criteria. Even if you are eligible for income tax deductions, you can save money by using this method.

You must invest in the NPS on a monthly basis. You can choose how much this sum should be, and it will be withdrawn from your bank account automatically every month.

Get monthly pension up to Rs 50,000

Example A: If you invest in NPS, then you can get pension of up to Rs 50,000 every month. For example, if you are currently 30 years old and if you invest Rs 10,000 in NPS, then till retirement i.e. at the age of 60 years, you will have a lump sum amount of more than Rs 1 crore.

  • Your age – 30 years
  • Retirement age – 60 years
  • Monthly investment – 10,000
  • Estimated return – 9%
  • Annuity period – 20 years
  • Investment in annuity plan – 40%
  • Estimated return on annuity – 6%

It can be noted that NPS gets a guarantee from the government. That is, you will get an annual return of 9 to 12 percent. Under this scheme, you will have to invest 40 percent of amount on maturity in an annuity scheme, so that you can get regular pension. The return on annuity is 6 percent.

Example B: In this case, you will have to deposit Rs 15,000 in this scheme on a monthly basis. You must put this money aside until you reach the age of 60. In this manner, you will have to deposit Rs 45 lakh in this scheme over a period of 25 years. Your maturity amount will be roughly Rs 2 crore when you reach the age of 60. You will receive 50 percent of this, or around Rs 1 crore, in a single sum, with the remaining Rs 1 crore available as a monthly pension.

  • you or your spouse are 35 years old
  • retirement age: 60 years
  • monthly investment: 15,000
  • get a monthly pension of Rs 50,000 after reaching the age of 60.

If the annuity rate is 6% at the time, you will receive a monthly pension of around Rs 50,000. In the event of the scheme holder’s death, the remaining amount will be paid out in a lump payment to his or her nominee.

  1. What is NPS?

    NPS is a social security scheme launched by the Union Government with an aim to provide steady income to individuals after retirement.

*Disclaimer: We have published the above information for reference Purpose only, For any changes on the content we refer to visit the Official website to get the latest & Official details, and we are not responsible for anything

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