Pension Scheme : The new rules of the retirement scheme National Pension System are going to give more relief to the subscribers on retirement. The central government has announced changes in the rules of NPS in the general budget. According to the new rules, under the National Pension System, now your company i.e. the employer will have to deduct 14 percent from the basic salary of the employees for contribution to NPS. Earlier this limit was 10 percent. That is, now your contribution to NPS will increase than before. This may definitely have some impact on the take home salary, but it is very beneficial in terms of retirement. Your monthly pension and the fund received on retirement can increase by 40 percent. We have explained this through calculation.
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Case 1 : Pension and Corpus Calculator at 14% Contribution
According to the new rule, if your basic salary is Rs 35000 at the age of 30, then you will have to contribute Rs 4900 to NPS every month at the rate of 14%. If you make this contribution till the age of 60 i.e. for 30 years then……
Age limit for opening NPS account: 30 years
Basic Salary: Rs 35,000
14% of basic salary: Rs 4900
Monthly investment in NPS: Rs 4900
Estimated return on investment: 10% p.a.
Total investment in 30 years: Rs 17,64,000
Total corpus after 30 years: Rs 1,11,68,695
Annuity Purchase : 40%
Estimated return on annuity: 8% p.a.
Monthly pension at age 60: Rs 29,783
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Case 2 : Pension and Corpus Calculator at 10% Contribution
According to the old rule, if your basic salary is Rs 35000 at the age of 30, then you will have to contribute Rs 3500 to NPS every month at the rate of 10%. If you make this contribution till the age of 60 i.e. for 30 years then……
Age limit for opening NPS account: 30 years
Basic Salary: Rs 35,000
10% of basic salary: Rs 3500
Monthly investment in NPS: Rs 3500
Estimated return on investment: 10% p.a.
Total investment in 30 years: Rs 12,60,000
Total corpus after 30 years: Rs 79,77,639
Annuity Purchase : 40%
Estimated return on annuity: 8% p.a.
Monthly pension at age 60: Rs 21,274
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What is the difference between pension and corpus
If we look at the difference in pension in both the cases, it is increasing from Rs 21274 per month to Rs 29783. That is, in the new rule, your pension is increasing by 40 percent.
Whereas the lump sum amount received on retirement is also increasing from Rs 47.86 lakh to Rs 67 lakh, that is, it is also increasing by about 40 percent.
