About the NPS calculator
The National Pension System (NPS) is a market-linked retirement scheme regulated by PFRDA. Contributions are invested in equity, corporate bonds and government securities in the proportions you or your fund choice decide.
At exit, part of the corpus can be taken as a lump sum and the rest is used to buy an annuity that pays a pension.
How the NPS calculator works
Contributions are made at the end of each month and compound monthly at the return you enter. The corpus is split by the cash share you enter; the rest buys an annuity at the annuity rate you assume.
The cash share and annuity rate are assumptions, not the current exit rules or an insurer’s quote.
Worked example
- Monthly investment
- ₹5,000
- Annual rate
- 10%
- Time period
- 25 years
- Assumed cash withdrawal share
- 60%
- Assumed annual annuity rate
- 6%
Example inputs
- Illustrative pension corpus
- ₹66,34,167.01
- Assumed cash withdrawal
- ₹39,80,500.21
- Assumed annuity purchase
- ₹26,53,666.81
- Illustrative monthly annuity
- ₹13,268.33
Calculated result
Why use a NPS calculator?
- See how monthly contributions could build a pension corpus.
- Compare different cash and annuity splits.
- Estimate the pension an annuity might pay.
NPS calculator FAQs
How much of the NPS corpus must buy an annuity?
PFRDA’s exit rules set the minimum share that must buy an annuity and how much can be taken as a lump sum. These rules have changed over time; check the current rules before relying on a split.
Does NPS give a guaranteed return?
No. Returns depend on the markets and the funds chosen.
Are there tax benefits?
NPS contributions can qualify for deductions, some only under the old tax regime, and an employer’s contribution can qualify under both. Check the current rules.
What is the difference between Tier I and Tier II?
Tier I is the retirement account with restricted withdrawals. Tier II is an optional, more flexible savings account without the same tax treatment.
What is an annuity rate?
The yearly pension an annuity pays as a percentage of the amount used to buy it. It depends on the insurer, the annuity type and your age.