How to use Pension Calculator or NPS Calculator? National Pension System (NPS) is a government sponsored pension scheme. It is a contribution based scheme where the amount of pension to be received by you in the future depends on the amount of corpus accumulated at the time of scheme’s maturity.
The NPS calculator will show you the amount of corpus that will be accumulated by you at the time of maturity and approximate amount of monthly pension to be received by you. The amount of corpus accumulated by the time you retire will depend on your investment amount and returns generated.
This NPS Calculator illustrates the tentative Pension and Lump Sum amount an National Pension Scheme subscriber may expect on maturity or 60 years of age based on regular monthly contributions, percentage of corpus reinvested for purchasing annuity and assumed rates in respect of returns on investment and annuity selected for.
|Name of the calculator||NPS Calculator|
|Title||How to use pension calculator|
|Subject||Pensioners Portal is providing the NPS calculator for Pensioners|
|NPS Calculator||Pensioners Portal Pension Calculator|
|SBI NPS Calculator||NPS-Calculator|
National Pension Scheme Calculator or NPS Calculator is an online tool, which allows the individual to calculate the estimated lump-sum and pension amount that they will receive under the NPS scheme.
With this calculator you will be able to know how much Pension and lump sum amount you will get when you retire at 60. The decision which you have to take is monthly contribution towards NPS. The more the invested money, the more the accumulated amount and the larger would be the eventual benefit of the accumulated pension wealth. The power of monthly compounding makes NPS an attractive retirement solution.
How to use Pension calculator?
To know how much corpus will be accumulated by you, the calculator will require the following details:
- Your current age and the age you wish to retire
- Amount that will be invested by you every month
- Returns that you expect to earn from your NPS investment
- Annuity period, i.e., number of years over which you wish to receive the monthly pension in the post retirement years. You are required to mention this number in years.
- The percentage of pension wealth invested in the annuity plan means the percent of accumulated corpus you will use to buy a pension plan. This cannot be below 40 percent if you withdraw at 60 years or more. If you withdraw before 60 years, it cannot be below 80 percent.
- Expected rate of interest on the annuity investment is the returns that you expect to earn from your annuity (pension) during the post-retirement period.
What the calculator shows?
The NPS calculator will show you the details of your investment. It will show you the amount invested by you during the accumulation phase of the scheme, interest earned by you, and the total amount of corpus generated at the time of maturity.
The calculator also shows the break-up of details of the amount which is re-invested to receive monthly pension and lump sum amount withdrawn by you. Based on the expected returns from the annuity, it also shows the amount of monthly pension that you will receive.
Under NPS, under section 80CCD(1B) of the Income Tax Act, the benefit of tax exemption is available on investment up to Rs.50,000. NPS can also help you in additional tax savings if you have completed the limit up to Rs 1.5 lakh under Section 80C. Withdrawal up to 60 percent of the amount on maturity of this plan is not taxed.
Who can use NPS calculator?
NPS calculator can be used by anyone who is eligible to invest in the scheme. As per the NPS rules, any Indian citizen between the ages of 18 years and 60 years can invest in the scheme. The person will require complying with know-your-customer (KYC) norms to start the investing in the scheme.
How the calculator works?
With the inputs given by you, you will get the corpus that will be accumulated by you at the time of your retirement. The corpus is calculated by using the principle of power of compounding.
What is National Pension Scheme?
National Pension Scheme (NPS) is a social security scheme launched by the Union Government with an aim to provide steady income to individuals after retirement. It is a hybrid investment scheme (that invest 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.