NPS Calculator – National Pension Scheme Calculator Online
The National Pension System or NPS is a measure to introduce a degree of financial stability for Indian citizens after they have retired. It was previously known as the National Pension Scheme. Anyone over the age of 60 is eligible to use the amount gathered in the pension corpus. You will need an NPS calculator to determine how much the total accumulation amounts to.
Any resident of the country who is between 18 and 60 years of age is eligible to build up a pension corpus. It is an investment and an asset after retirement. Since most people in India have private jobs with little security, they need a National Pension Scheme calculator. Pension schemes in the country are not market-linked instruments and earn sound returns.
How can an NPS calculator help you?
Here are the ways the NPS pension calculator will assist you.
- It provides you with the amount of money which you are entitled to in the future. The pension amount is an investment and not a liability. Using an NPS calculator online is essential to determine the total corpus.
- Under the existing legislature, no individual can withdraw the entire amount of post-retirement. Besides, 40% worth of the total sum must be invested in annuities. Furthermore, the remaining 60% is subjected to taxation too. All these figures will be disclosed in detail once you start using our NPS scheme calculator.
- The calculator never errs. If you have ever tried to manually calculate the pension amounts, you will understand how tough it is. Thankfully, our NPS calculator in India will automate the entire process.
- Lastly, you can now determine the taxation regime on pension funds, the total amount you will have every month-end and several other details- all via the calculator.
Formula for calculating Pension amounts
NPS, like all pension schemes around the world, uses compounding interest to calculate returns.
The formula that the National Pension Scheme calculator India uses is:
A = P (1 + r/n) ^ nt
In the equation, the amount is A. The other variables are the following.
|R/r||Rate of interest per annum|
|N/n||Number of times interest compounds|
An example of how pension aggregates is essential here.
If you are 34 years old and your monthly contribution is Rs 3000, you will need to add to the pension account for 26 more years. Assuming that the rate of interest or ROI is expected at 10% every year, the following are the details the National Pension Plan calculator offers.
Total Principal invested= Rs 6.24 Lakh
Sum expected at maturity= returns + principal= Rs 29.81 Lakh
Expected monthly pension= Rs 7534.
How to use the NPS calculator?
Follow the simple steps mentioned below to use the NPS calculator
Step 1: Enter the amount you want to invest every month towards your retirement corpus in the pension scheme
Step 2: Enter your present age
Step 3: Use the slider to select the expected rate of return
The results will be displayed within seconds.
Advantages of using the National Pension Scheme calculator
These are the following:
- No more manual calculations. The right results every time.
- You will now know how much your pension amount will be. That will aid you in future planning.
- One-stop online calculation.
Likewise, Groww provides you with a wide range of other financial tools besides the NPS calculator. You will find them at the bottom of the page.
“Looking to invest? Open an account with Groww and start investing in direct Mutual Funds for free”
Frequently Asked Questions (FAQ) on NPS calculator
Some common queries we face are the following.
- I have heard that pension maturity values vary between tier-1 and tier-2 cities. Is it true?
No, this is a common misconception. The pension scheme has uniform rates across the country.
- Does the calculator help me determine the amount of tax I have to pay when withdrawing the money?
No, tax implications are not calculated.
- I have availed the Auto choice – Lifecycle Fund which NPS offers. Can I use the NPS calculator?
Yes, you can easily do so.