NPS scheme: An easy way for a comfortable life after retirement, know details

The National Pension System (NPS) is a public pension plan that uses both stock and debt securities. Government guarantee exists for NPS. If you want a higher monthly income after retirement, you should invest in the NPS scheme.

Everyone is concerned about retirement costs. If you also want to be financially comfortable in your senior years and avoid running into financial difficulties, start making plans now. Just the day you start your career should be the first day you start saving for retirement. In actuality, the more money you have till retirement, the earlier you start saving. You have a variety of investing alternatives at your disposal to help you build up your retirement savings, including EPF, NPS, the stock market, mutual funds, real estate, etc.

The central government has created a number of investment plans to help you protect your retirement. If you are employed, you must also believe that you will receive a sizable monthly pension when you retire. However, in order to do this and have a safe retirement after 60 years, you must start investing right away.

NPS Pension Yojana is a government programme, similar to Employee Provident Fund (EPF), Sukanya Samriddhi Yojana, and Public Provident Fund (PPF). Any investor in this can use maturity amount to raise monthly pension amount. You can save up to two lakh rupees per year on taxes by using NPS. You may defer taxes under Section 80C of the Income Tax up to a maximum of Rs 1.5 lakh. You would receive an additional tax exemption of up to Rs 50,000 if you invest in NPS.

You can earn Rs 1.91 crore by making monthly deposits of Rs 5000 into the NPC for 40 years. You will thereafter receive a monthly pension of 2 lakhs upon investing the maturity amount. You will also receive a return of Rs. 1.43 lakh and Rs. 63,768 per month under this from the Systematic Withdrawal Plan (SWP). In this, the investor would receive an annuity payment of Rs 63,768 per month for the rest of their lives.

If you make monthly investments of Rs 5000 for 20 years till retirement, you will receive a lump sum maturity amount between Rs 1.91 crore and Rs 1.27 crore. Following this, you will be eligible for a monthly pension of Rs. 63,768 at a 6% return on Rs. 1.27 crore.