NPS Calculator
Plan your dream retirement with the National Pension System (NPS) . This tool helps you estimate the pension and tax-free lump sum you will receive at age 60. Maximize your savings with extra tax benefits under Section 80CCD(1B).
Total Corpus at Age 60
Invested
₹21.00 L
Returns
₹1.70 Cr
Investment vs Growth
Ready to Invest?
NPS is regulated by PFRDA. You can open an account online directly.
Open eNPS Account (Official)🤔 How can an NPS calculator help you?
Planning for retirement can be complex due to factors like inflation and life expectancy. An NPS Calculator simplifies this by estimating the future value of your investments. It helps you:
- Visualize Corpus: See how much wealth you can accumulate by the time you retire at 60.
- Plan Monthly Pension: Determine the monthly contribution needed today to get your desired pension amount tomorrow.
- Tax Planning: Understand how NPS helps you save tax under Section 80C and 80CCD(1B).
🧮 Formula for calculating Pension amounts
The calculator uses the compound interest formula to estimate the total corpus and then splits it for pension calculation.
1. Total Corpus (Compound Interest)
A = P × [ (1+r)^n - 1 ] / r × (1+r)
Where P = Monthly Investment, r = Monthly Interest Rate, n = Total Months.
2. Monthly Pension
Pension = (Total Corpus × % Annuity × Annuity Rate) / 12
Example: If Corpus is ₹1 Cr, Annuity share is 40%, and Rate is 6%: Pension = (1 Cr × 40% × 6%) / 12 = ₹20,000/month.
🛠️ How to use the NPS calculator?
- Enter Monthly Investment: Input the amount you can contribute towards NPS every month (e.g., ₹5,000).
- Your Age: Enter your current age. The calculator assumes retirement at 60 years.
- Expected Returns: Adjust the ROI slider based on your risk appetite (Equity-heavy NPS funds may give 10-12%, Debt funds 8-9%).
- Annuity Settings: Choose how much percentage (min 40%) you want to invest in an annuity plan for monthly pension.
🚀 Advantages of using the NPS calculator
- ✅ Accuracy: Eliminates manual calculation errors for compound interest over long periods (20-30 years).
- ✅ Tax Clarity: Helps you visualize the tax-free lump sum component (60% of corpus).
- ✅ Goal Setting: Helps you reverse-calculate: "If I want ₹50k pension, how much should I invest today?"
- ✅ Flexibility: Experiment with different ROI and Annuity rates to see best/worst case scenarios.
Frequently Asked Questions
What is the lock-in period for NPS? ▼
NPS is primarily a retirement scheme, so the lock-in period is until the subscriber reaches the age of 60. However, partial withdrawals (up to 25% of your own contribution) are allowed after 3 years for specific reasons like education, marriage, or medical emergencies.
How much of the NPS corpus is tax-free? ▼
At maturity (age 60), you can withdraw up to 60% of the total corpus as a tax-free lump sum . The remaining 40% (minimum) must be invested in an annuity plan to provide a monthly pension, which will be taxable as per your income slab.
What is the extra tax benefit in NPS? ▼
Apart from the standard ₹1.5 Lakh limit under Section 80C, NPS subscribers can claim an additional deduction of ₹50,000 under Section 80CCD(1B) . This makes NPS a highly tax-efficient investment.