Retirement Plan: You can get a pension of up to two lakhs by investing in NPS, understand the complete mathematics

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Retirement Plan: Do you also want to get a pension of two lakhs per month after your retirement? If yes, then for this you need to invest in National Pension Scheme (NPS) with proper planning. National Pension Scheme is one of the most popular schemes for pension after retirement. The good thing is that NPS gives the option to invest in equity also. Investment in this scheme should be started as soon as possible. However, if you want to start investing now, it is not too late. By investing even in a short time, a pension of up to Rs 2 lakh can be earned. Let us know how much you will have to invest every month to get a pension of up to Rs 2 lakh.

How much will have to be invested

As per NPS rules, no subscriber is allowed to withdraw the entire amount on maturity. In this it is necessary to buy an annuity of at least Rs 40. This is how anyone gets pension after retirement. Whereas, the remaining 60 percent amount can be withdrawn as per your wish. Apart from this, those investing in NPS have the option to invest their entire amount in annuity. Now let us understand how to get a pension of two lakhs. Understand its mathematics like this, if the investor has started investing at the age of 40, then he has the option of investing for 20 years. To get a pension of Rs 2 lakh every month, you should have maturity corpus of Rs 4.02 crore. Corpors will give 6 percent return in 20 years. Now, leaving Rs 1.61 crore as annuity, you can withdraw the remaining Rs 2.41 crore. In this case, Rs 52,500 will have to be invested every month. By calculating 10 percent return on this, Rs 4.02 crore can be deposited till maturity.

what is nps

The full form of NPS is National Pension System. It is a pension scheme run by the Government of India for the economic security of the society after old age. This scheme is available to all Indian citizens and under it a cash benefit is provided which is received by the children of the person. This scheme provides a steady source of income to the individual for financial security in the event of poverty and old age after their retirement. Under the scheme, a person gets cash at regular intervals, which improves his financial condition. To join the scheme, a person has to fulfill the prescribed eligibility criteria and make regular contributions as per the scheme.

How to invest in NPS

Investing in NPS is quite easy. To invest do this:

• Registration:The first step is to register with NPS. You can register for NPS through the director or causal institution.

• Select Investment Option: You have to select an investment category. There are generally three options – National Pension Scheme (NPN), National Pension Scheme Lite (NPN-Lite), and National Pension Scheme Swavalamban (NPN-Swavalamban). These provide various investment options in which individuals can invest as per their financial plan and risk.

• Regular Contributions: Investors have to invest at regular intervals. Regular contributions have to be made as per the scheme.

• Consider Investment for Chosen Category: Investors have to consider investing according to the selected investment category. There can be various investment options for this such as in reserve funds, securities or general investments.

• Discipline in Investing: It is very important for the investor to maintain discipline while investing in NPS. Regular contributions yield benefits and help in completing the financial plan.

• Periodic Review and Reassessment: It is advisable to review and re-evaluate the investment position from time to time. If there is any change in your financial circumstances, it may be appropriate to make necessary changes in your investment plan.

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