👵Pension Calculator

Understanding the EPS 95 Calculation

For employees in India covered under the EPF Act, a portion of the employer's contribution (8.33%) goes into the Employee Pension Scheme (EPS). The pension is calculated based on your 'pensionable salary' and 'pensionable service.' Recent Supreme Court rulings on 'higher pension' options have changed the landscape. Use this calculator to estimate your monthly EPS payout after age 58, ensuring you meet the 10-year minimum service criteria set by the EPFO.

Employees' Provident Fund Organisation (EPFO)

Maximizing the National Pension System (NPS)

The NPS is a market-linked voluntary retirement scheme. Upon reaching 60, you must use at least 40% of the corpus to buy an annuity (monthly pension) from a PFRDA-registered provider. This tool helps you simulate different Tier-I and Tier-II contribution levels and annuity rates to see your potential monthly income in INR, factoring in the tax-free lumpsum withdrawal of 60%.

PFRDA – National Pension System

Social Security for All: APY and PM-SYM

The Atal Pension Yojana (APY) provides a guaranteed minimum pension of ₹1,000 to ₹5,000 per month for workers in the unorganized sector. Similarly, the PM-SYM scheme targets low-income earners. The Ministry of Labour and Employment encourages early enrollment to minimize premiums. Our calculator allows you to see the contribution required based on your current age to secure a fixed monthly pension for your old age in India.

Ministry of Labour and Employment

How is the EPS pension calculated in India?

The formula used is: (Average Salary of last 60 months x Years of Service) / 70. However, there is a wage cap (currently ₹15,000) for standard calculations unless you have opted for the 'higher pension' scheme. Our tool provides estimates for both scenarios to help Indian professionals understand their future entitlements from the EPFO.

Is the NPS pension taxable in India?

The 60% lumpsum withdrawn at age 60 is completely tax-free. However, the monthly annuity (pension) you receive from the remaining 40% is treated as regular income and taxed according to your applicable income tax slab in that year. Use this tool to plan your post-retirement tax liability under the latest Indian budget rules.

Can I withdraw my EPS contribution before retirement?

If you have less than 10 years of service and are leaving the workforce, you can apply for a 'withdrawal benefit' via Form 10C. However, if you have more than 10 years of service, you are only eligible for a monthly pension starting at age 58 (or a reduced pension at 50). This calculator helps you decide whether to take the lumpsum or wait for the lifelong pension benefits.

Start Early

The power of compound interest means starting early can dramatically increase your pension pot. Every year counts.

Maximize Employer Contributions

Contribute at least enough to get your full employer match - it is essentially free money. Many employers match contributions up to 5-6%.

Increase Contributions with Raises

When you get a raise, consider putting half of it into your pension. You will not miss money you never got used to having.

Annual Reviews

Review your pension annually. Check fees, performance, and whether your allocation still matches your risk tolerance and timeline.

Income Replacement: 70-80%

Most experts recommend replacing 70-80% of pre-retirement income. You will have fewer expenses (no pension contributions, mortgage potentially paid off), but may have higher healthcare costs.

The 4% Rule

A common guideline is that you can safely withdraw 4% of your pension annually. This means you need 25x your annual retirement expenses saved.

Asset Allocation by Age

A common rule: subtract your age from 110 to get the percentage in stocks. At 30, that is 80% stocks, 20% bonds. At 60, it would be 50% stocks, 50% bonds.

How much should I contribute?

A good rule is to contribute 12-15% of your income (including employer contributions). At minimum, contribute enough to get your full employer match.

What if I start late?

It is never too late to start. Contribute more aggressively, consider delaying retirement by a few years, and consider part-time income in retirement to make up the gap.

What return rate should I use?

For long-term planning, 6-7% is a realistic estimate after inflation for a diversified stock/bond portfolio. Be conservative - better to have a pleasant surprise than fall short.