NPS Calculator
Plan your retirement with the National Pension Scheme using this calculator
Total Contribution
Total contributions
Estimated Returns
Interest earned
Retirement Corpus
Expected corpus at retirement
Effective Yield
Annualized return
NPS Growth Over Time
Contribution vs Returns
Yearly NPS Calculation
| Year | Contribution (₹) | Interest Earned (₹) | Total Value (₹) |
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What is NPS (National Pension System)?
The National Pension System (NPS) is a voluntary, long-term retirement savings scheme launched by the Government of India. It is regulated by the Pension Fund Regulatory and Development Authority (PFRDA). Any Indian citizen between the ages of 18 and 60 can open an NPS account and contribute regularly until retirement. Contributions are invested in a mix of equity, government bonds, and corporate debt, giving individuals an opportunity to build a retirement corpus with market-linked returns.
Why is NPS Important?
- Provides a reliable pension income after retirement.
- Encourages disciplined, long-term savings for old age.
- Offers tax benefits under Section 80C and 80CCD of the Income Tax Act.
- Creates financial security and reduces dependency after retirement.
- Transparent and regulated by the Government of India.
Rules of NPS (as per Government of India)
- Eligibility: Indian citizens (residents and NRIs) aged 18–60 years.
- Minimum contribution: ₹500 per contribution and ₹1,000 annually.
- Two types of accounts:
- Tier I Account: Mandatory retirement account (withdrawals restricted).
- Tier II Account: Voluntary savings account (flexible withdrawals).
- Withdrawal:
- Up to 60% of the corpus can be withdrawn at retirement (tax-free).
- Minimum 40% must be used to purchase an annuity (provides monthly pension).
- Partial withdrawals (up to 25%) are allowed for specific reasons after 3 years.
- Account matures at age 60, extendable till age 70.
Benefits of NPS
- Market-linked returns that generally beat traditional savings instruments.
- Tax deductions under Section 80C (up to ₹1.5 lakh) and Section 80CCD(1B) (extra ₹50,000).
- Flexible investment choices between equity, government securities, and corporate bonds.
- Portable across jobs and locations.
- Low-cost investment compared to mutual funds and insurance products.
Drawbacks of NPS
- Withdrawal restrictions in Tier I account until retirement.
- Mandatory annuity purchase reduces lump sum availability.
- Annuity income is taxable in retirement.
- Returns are market-linked and not guaranteed.
Frequently Asked Questions (FAQ)
1. Who can open an NPS account?
Any Indian citizen (resident or NRI) between 18 and 60 years of age.
2. Is NPS investment safe?
NPS is regulated by the PFRDA and managed by licensed pension fund managers. While returns are market-linked, it is considered safer compared to direct equity investments.
3. Can I withdraw money from NPS before 60?
Yes, partial withdrawals (up to 25% of own contributions) are allowed after 3 years for specific reasons like higher education, marriage, or medical treatment.
4. How much pension will I get from NPS?
Pension depends on total contributions, investment returns, and annuity rates at retirement. Use our NPS calculator to estimate your monthly pension.
5. Is NPS better than PPF or EPF?
NPS usually offers higher long-term returns due to equity exposure, but unlike PPF/EPF, the pension (annuity) is taxable. It is best used as a supplement to other retirement savings.