NPS Pension Calculation: Starting NPS at the age of 30 makes retirement planning easier. Investing at the right time can earn you a monthly pension of ₹50,000.

NPS Pension Calculation: At the age of 30, most people are at a stage in their career where their income is becoming stable and they begin to seriously consider future planning. This is the age when retirement preparations should begin, which can significantly reduce financial worries in the future.

Nowadays, the National Pension System (NPS) is considered a strong option for the long term. The most common question is how much investment is needed at the age of 30 to achieve a monthly pension of ₹50,000 after retirement. Let us explain the calculation.

How much fund is required for a monthly pension of Rs 50,000?

If you expect a monthly pension of ₹50,000 after retirement, your annual pension would be approximately ₹6 lakh. NPS typically mandates a 40% investment in annuity at retirement. Assuming an annuity yields an average annual return of 6%, annuity funds of approximately ₹1 crore are required to achieve an annual pension of ₹6 lakh.

This means that your total NPS corpus at retirement should be approximately ₹2.5 crore (approximately ₹2.5 crore). 40% of this should go towards annuity, and the remaining amount can be withdrawn in a lump sum. This calculation is based on long-term average returns and current regulations. Therefore, these figures may fluctuate slightly.

How much should I invest every month at the age of 30?

After the fund, the question now arises: how much money will need to be deposited every month if you start investing at the age of 30? Let's assume you retire at the age of 60, meaning you have about 30 years left. If NPS provides an average annual return of 9 to 10 percent,  then to build a corpus of Rs 2.5 crore, you may have to invest around Rs 12,000 to Rs 14,000 every month.  If you increase your investment amount a little every year, such as increasing your contribution as your salary increases, the initial burden can be reduced further. The real advantage here is time. The sooner you start, the larger the fund will be created from a smaller amount.

PC: ABPNews