This NPS calculator will help you estimate your NPS contribution. So you can build a substantial corpus for a secure and comfortable retirement.
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This chart illustrates how your investment grows year by year. Watch the power of compounding as your gains (orange) begin to significantly outpace your total investment (indigo) over time.
This NPS calculator is designed to help you understand how your NPS investments grow over time and how our user-friendly calculator can assist you in planning for a secure retirement.
Whether you’re just starting your career or nearing retirement, you’ll find valuable information on NPS benefits, the underlying growth mechanisms, and practical examples to empower your pension planning decisions.
Our NPS calculator is designed to be intuitive and straightforward. Follow these simple steps to get an instant estimate of your potential NPS corpus and pension:
An NPS calculator is an indispensable online tool that simplifies the complex process of estimating your pension corpus and projected annuity payouts. Instead of manual calculations, this NPS calculator helps you to calculate your retirement savings by providing instant clarity on your potential future wealth.
It allows you to quickly input your annual investment amount, your expected investment tenure, and anticipated returns. In return, it provides you a projection of your total retirement corpus, the amount you contribute, the total gains you accrue, and an estimate of your monthly pension. This helps you to plan your retirement effectively, understand the long-term impact of compounding, and make informed decisions about your personal financial journey.
It’s particularly useful for setting your retirement goals, assessing different contribution scenarios that fit your unique needs, and visualizing your financial independence in later life.
The National Pension System (NPS) investment follows a compound interest growth model, similar to other long-term investment vehicles, that illustrates how your money appreciates over time. While the actual calculation for NPS can be complex due to market-linked returns and varying contribution frequencies, a simplified Future Value of Annuity formula is often used to project the corpus (total accumulated amount) based on regular contributions.
The core idea is to project the total value of your regular investments assuming a certain average annual growth rate. The formula can be expressed as:
FV = P×((1+r)^n−1)/r
Let’s break down each component in the context of an NPS projection:
In essence, this formula helps you estimate the future value of a series of equal annual payments, compounded at an assumed average rate of return over a set number of years.
The actual monthly pension would then be calculated based on this projected corpus, the percentage of corpus annuitized (mandatorily at least 40%), and the prevailing annuity rates at the time of retirement.
Let’s illustrate the potential of NPS with a practical example.
Suppose you are 30 years old and plan to contribute ₹50,000 annually to your NPS Tier I account until you retire at age 60 (a tenure of 30 years).
For this projection, we’ll assume an average annual return of 10%.
Over these three decades, your consistent annual contributions, can lead to a substantial retirement corpus. This example highlights how disciplined, long-term investing in NPS can build a significant fund for your post-retirement life.
Here’s a detailed table showing the compounding of your ₹50,000 annual investment over 30 years at an assumed 10% annual return:
| Year | Age | Opening Balance (₹) | Annual Contribution (₹) | Assumed Interest (₹) | Closing Balance (₹) |
|---|---|---|---|---|---|
| 1 | 31 | 0 | 50,000 | 5,000.00 | 55,000.00 |
| 2 | 32 | 55,000.00 | 50,000 | 10,500.00 | 1,15,500.00 |
| 3 | 33 | 1,15,500.00 | 50,000 | 16,550.00 | 1,82,050.00 |
| 4 | 34 | 1,82,050.00 | 50,000 | 23,205.00 | 2,55,255.00 |
| 5 | 35 | 2,55,255.00 | 50,000 | 30,525.50 | 3,35,780.50 |
| 6 | 36 | 3,35,780.50 | 50,000 | 38,578.05 | 4,24,358.55 |
| 7 | 37 | 4,24,358.55 | 50,000 | 47,435.86 | 5,21,794.41 |
| 8 | 38 | 5,21,794.41 | 50,000 | 57,179.44 | 6,28,973.85 |
| 9 | 39 | 6,28,973.85 | 50,000 | 67,897.39 | 7,46,871.24 |
| 10 | 40 | 7,46,871.24 | 50,000 | 79,687.12 | 8,76,558.36 |
| ... | ... | ... | ... | ... | ... |
| 25 | 55 | 39,26,099.64 | 50,000 | 3,97,609.96 | 43,73,709.60 |
| 26 | 56 | 43,73,709.60 | 50,000 | 4,42,370.96 | 48,66,080.56 |
| 27 | 57 | 48,66,080.56 | 50,000 | 4,91,608.06 | 54,07,688.62 |
| 28 | 58 | 54,07,688.62 | 50,000 | 5,45,768.86 | 60,03,457.48 |
| 29 | 59 | 60,03,457.48 | 50,000 | 6,05,345.75 | 66,58,803.23 |
| 30 | 60 | 66,58,803.23 | 50,000 | 6,70,880.32 | 73,79,683.55 |
Total Contribution: ₹15,00,000 (₹50,000 x 30 years)
Total Assumed Gain: ₹58,79,683.55
Projected Retirement Corpus (FV): ₹73,79,683.55
Please note: This example uses an assumed average annual return of 10%. Actual returns on NPS are market-linked and can vary. The table provides a simplified view of annual compounding for illustration.
Here are some common questions about NPS
NPS, or National Pension System, is a government-sponsored, long-term, voluntary retirement savings scheme in India designed to help subscribers accumulate a retirement corpus. It is regulated by PFRDA (Pension Fund Regulatory and Development Authority).
No, NPS returns are market-linked and are not guaranteed. The returns depend on the performance of the chosen fund managers and asset classes (equity, corporate debt, government bonds, alternative assets).
Tier I is the primary pension account, offering tax benefits and having a lock-in period until retirement (age 60). Withdrawals are restricted. Tier II is a voluntary savings account with no lock-in, offering flexibility for withdrawals, but no tax benefits on contributions (except for government employees).
The minimum annual contribution for a Tier I NPS account is ₹1,000 per financial year.
At age 60, you can withdraw up to 60% of your corpus as a tax-free lump sum. The remaining 40% (minimum) must be used to purchase an annuity (a regular pension from an Annuity Service Provider).
Partial withdrawals are allowed after 3 years for specific purposes (e.g., higher education, marriage, critical illness, buying a house), up to 25% of your own contributions, three times during the entire tenure with a 5-year gap. Premature exit before age 60 (after 5 years) allows withdrawal of 20% lump sum and mandatory annuitization of 80%.
Yes, NPS offers tax benefits under Section 80C, 80CCD(1), 80CCD(1B) (additional ₹50,000 deduction), and 80CCD(2) (employer contribution for salaried individuals). The lump sum withdrawal of 60% at maturity is tax-free.
Yes, NRIs can open an NPS account. However, if an Indian citizen residing outside India subsequently becomes an OCI (Overseas Citizen of India), their NPS account will be closed.
This pension calculator is meant for informational purposes only and is not intended to create any right, obligation, or to constitute any advice or opinion or to substitute any professional advice. It should not be used as a basis for any investment decision.
Past performance neither guarantees future returns nor assures any specific pension amount from NPS investments. Investments under the National Pension System (NPS) are subject to market risks. The annuity plans available are as approved by the Authority and are subject to change without any prior notice.
Please obtain professional advice before relying on any information or calculation contained herein. We disclaim any liability with respect to the accuracy of information or calculation, any error or omission, or any loss or damage incurred by anyone in reliance on the contents herein.
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