PC: Fortune India
National Pension Scheme (NPS) is a popular option to ensure regular income after retirement. Although starting early is ideal, you can aim for a monthly pension of Rs 2 lakh even with a shorter investment tenure. Here's how to plan your NPS contribution for this goal.
NPS withdrawal rules
Currently, NPS subscribers cannot withdraw the entire amount on maturity. A minimum of 40 percent should be used to purchase an annuity plan that provides regular income. The remaining 60 percent amount can be withdrawn. However, customers can opt for a 100 percent annuity.
PC: CompareRemit
Rs 2 lakh monthly investment for pension
If you are 40 years old and you are planning to invest in NPS for 20 years to get a monthly pension of Rs 2 lakh, here is what you need to do.
• To receive a pension of Rs 2 lakh, you would need a total maturity amount of Rs 4.02 crore assuming 6 per cent returns in 20 years.
• You have to buy a 40 percent annuity equal to Rs 1.61 crore.
• You can withdraw the remaining Rs 2.41 crore (60 percent).
To raise funds of more than Rs 4 crore in 20 years
PC: The New Indian Express
To accumulate more than Rs 4 crore in 20 years, you will have to invest Rs 52,500 every month in NPS assuming 10 percent returns. This will give you access to Rs 4.02 crore at maturity. Start planning your NPS contributions today for a financially secure retirement.
