NPS Calculator

The National Pension System (NPS) is a Government of India-backed retirement planning scheme that helps every individual to build a strong retirement corpus, with low risk and predictable returns.

A salaried professional, self-employed, or even a government employee can leverage the power of compounding to fund their retirement planning using the National Pension System.

And, Definedge’s calculator will help you in this journey to visualise the Maturity amount or final value even before you start investing.

What is NPS?

The National Pension System (NPS) is specifically designed to fund Indian citizens’ retirement corpus through regular contributions during their work years (18 years to 60 years of the investor’s age).

NPS is regulated by the Pension Fund Regulatory and Development Authority (PFRDA), and it does offer attractive returns by investing across various asset classes, such as equity, corporate debt, government securities, and alternative investments.

On retirement or maturity, these funds can be withdrawn, and 40% of the accumulated corpus should be invested in annuities, and 60% of the amount will be taxable income as per the income tax bracket the assessee comes under.

What is an NPS Calculator?

Definedge’s NPS calculator is an online tool that helps investors predict the maturity value of their NPS investments based on inputs like:

– Investment Per Month
– Expected Rate of Return
– Investor’s Age

The calculator provides an estimate of:

– Total investment made
– Expected maturity amount
– Interest earned
– Annuity investment

How to use the NPS Calculator?

Using Definedge’s NPS calculator is easy and quick with the steps:

Step 1: Enter the amount you want to invest every month
Step 2: Enter the expected Interest rate (that ranges between 8-9%)
Step 3: Enter the current age

The results will be shown in the blink of an eye.

Advantages of using an NPS Calculator?

– Plan retirement goals efficiently
– Visualize retirement corpus
– Estimate future pension income
– Compare contribution scenarios
– Make better financial decisions

A comfortable retirement is built through consistent planning and disciplined investing, and the National Pension System (NPS) is one such scheme that ticks all the marks with the backing of the Government of India.

The earlier you start, the stronger you retire!

Frequently Asked Questions (FAQs):

1. Can I choose the type of instruments where I want to invest through NPS?
Yes, you can choose the asset class like Equity, Debt, Government Securities, and the returns for all of them vary for each of them.

2. Is NPS calculated every month or yearly?
You can make contributions on a monthly timeline, but the returns are calculated on a yearly basis.

3. What is the difference between Tier I and Tier II NPS accounts?
Tier I minimum contribution in NPS is ₹1,000 per year, whereas there is no minimum account for Tier II.