NPS Calculator: The National Pension System is a voluntery and long -term investment plan for retirement, which comes under the purview of the Pension Fund Regulatory and Development Authority (PFRDA) and the Central Government. This pension scheme can be joined from the age of 18 years. But this is not possible for everyone. You may have started your job in 22 years or 23 years. It may also be that many people are unable to give their priority to retirement in the beginning of the job. In such a situation, even if it takes some time, the investment made in this scheme in a disciplined manner can improve your life on retirement.
You can also make a big plan with small amount
Suppose you have started a job in 23 years or 24 years, then by 25 years, you start getting stable in your job. From where you can also plan investment with small amounts. The good thing in NPS is that no matter how much you start this scheme with any amount, it has the facility like SIP top up, through which you can increase the investment amount every year by the fixed percentage. That is, as your income increases, you can give your National Pension Scheme top up (NPS Topup) booster.
If you join NPS at the age of 25 and Monthly starts with an investment of Rs 3500. At the same time, if you top up 5 percent every year, then the amount of money you get on retirement can be Rs 1.50 crore. Whereas, you can also arrange 1 lakh rupees pension every month.
NPS: How to invest?
Age to join pension scheme: 25 years
Scheme: Active Choice
Investment in NPS every month: Rs 3,500
Top up in investment after every year: 5%
Your total investment in 35 years: Rs 37,93,453
Estimated return on investment: 12% annually
Total Corpus: Rs 3,09,23,608 (about Rs 3 crore)
Total advantage: Rs 2,71,30,155 (Rs 2.71 crore)
Investment in Enuity Plan: 50%
Annuity rate: 8%
Pension Wealth: Rs 1,54,61,804 (about Rs 1.55 crore)
Lump Summer Amount: Rs 1,54,61,804 (Rs 1.55 crore)
Monthly Pension: 1,03,079 rupees (about 1 lakh rupees)
NPS Tax Benefit: Tax gets benefits
Under Section 80CCD (1), the contribution up to Rs 1.5 lakh for Tier I investing up to Rs 1.5 lakh is eligible for tax standation under section 80C. Whereas in addition to deduction under section 80ccD 1 (b), customers are allowed to be deducted up to Rs 50,000 for Tier I contribution.
The contribution of the employee for Tier I investment under section 80ccD (2) is eligible for the central government’s contribution up to 14 per cent and up to 10 per cent for others. This deduction is more than the deduction limit applied under Section 80C.
NPS: Risk Factor also understand
There is a limit of 75 percent to 50 percent on equity exposure for NPS account. This limit is 50 percent for government employees. In the prescribed limit, the year the age of the investor will be 50 years, starting from that year, the equity of equity will be reduced by 2.5 percent every year. However, the limit for investors aged 60 years and above is 50 per cent. It stabilizes risk-returns equation in the interest of investors, which means that the corpus equity is somewhat protected from the instability of the market. At the same time, the earning capacity of NPS is higher than other fickle income schemes.
(Source: NPS Calculator, NPS Website)
