NPS Calculator
Project your National Pension System corpus at retirement, the 60% tax-free lump sum, and the monthly pension from the mandatory 40% annuity. Includes employer contribution under Section 80CCD(2) — one of the most underused tax deductions for salaried employees.
Mandatory split at retirement
- · 60% can be withdrawn lump-sum (tax-free)
- · 40% must convert to annuity (taxable income)
- · Higher annuity rate options often have lower or no return-of-purchase-price
NPS corpus at retirement
₹1,13,96,627
30 years to retire · 10.0% return · ₹5,000/mo total contribution
- 60% lump sum (tax-free)
- ₹68,37,976
- 40% annuity corpus
- ₹45,58,651
- Monthly pension (before tax)
- ₹26,592
Locked into pension
Annual: ₹3,19,106
Corpus composition
Corpus growth by age
Year-by-year breakdown
| Age | Your share | Employer | Growth | Closing |
|---|---|---|---|---|
| 31 | ₹60,000 | ₹0 | ₹3,351 | ₹63,351 |
| 32 | ₹60,000 | ₹0 | ₹9,985 | ₹1,33,337 |
| 33 | ₹60,000 | ₹0 | ₹17,313 | ₹2,10,650 |
| 34 | ₹60,000 | ₹0 | ₹25,409 | ₹2,96,059 |
| 35 | ₹60,000 | ₹0 | ₹34,353 | ₹3,90,412 |
| 36 | ₹60,000 | ₹0 | ₹44,233 | ₹4,94,645 |
| 37 | ₹60,000 | ₹0 | ₹55,147 | ₹6,09,792 |
| 38 | ₹60,000 | ₹0 | ₹67,205 | ₹7,36,996 |
| 39 | ₹60,000 | ₹0 | ₹80,525 | ₹8,77,521 |
| 40 | ₹60,000 | ₹0 | ₹95,239 | ₹10,32,760 |
| 41 | ₹60,000 | ₹0 | ₹1,11,495 | ₹12,04,255 |
| 42 | ₹60,000 | ₹0 | ₹1,29,453 | ₹13,93,708 |
| 43 | ₹60,000 | ₹0 | ₹1,49,291 | ₹16,02,998 |
| 44 | ₹60,000 | ₹0 | ₹1,71,206 | ₹18,34,205 |
| 45 | ₹60,000 | ₹0 | ₹1,95,417 | ₹20,89,621 |
| 46 | ₹60,000 | ₹0 | ₹2,22,162 | ₹23,71,783 |
| 47 | ₹60,000 | ₹0 | ₹2,51,708 | ₹26,83,492 |
| 48 | ₹60,000 | ₹0 | ₹2,84,348 | ₹30,27,840 |
| 49 | ₹60,000 | ₹0 | ₹3,20,406 | ₹34,08,245 |
| 50 | ₹60,000 | ₹0 | ₹3,60,239 | ₹38,28,485 |
| 51 | ₹60,000 | ₹0 | ₹4,04,244 | ₹42,92,728 |
| 52 | ₹60,000 | ₹0 | ₹4,52,856 | ₹48,05,584 |
| 53 | ₹60,000 | ₹0 | ₹5,06,559 | ₹53,72,143 |
| 54 | ₹60,000 | ₹0 | ₹5,65,885 | ₹59,98,028 |
| 55 | ₹60,000 | ₹0 | ₹6,31,423 | ₹66,89,452 |
| 56 | ₹60,000 | ₹0 | ₹7,03,824 | ₹74,53,276 |
| 57 | ₹60,000 | ₹0 | ₹7,83,807 | ₹82,97,083 |
| 58 | ₹60,000 | ₹0 | ₹8,72,164 | ₹92,29,247 |
| 59 | ₹60,000 | ₹0 | ₹9,69,774 | ₹1,02,59,022 |
| 60 | ₹60,000 | ₹0 | ₹10,77,605 | ₹1,13,96,627 |
How it works
NPS combines monthly contributions with market-linked returns during accumulation, then a forced split at retirement:
Each month (until age 60):
i = annual_return / 12
balance = (balance + monthly_contribution) × (1 + i)
At retirement (age 60):
lump_sum = retirement_corpus × 0.60 // tax-free
annuity_corpus = retirement_corpus × 0.40
Monthly pension:
annual_pension = annuity_corpus × annuity_rate
monthly_pension = annual_pension / 12Monthly contribution includes both your share and (optionally) your employer's — the latter qualifies for an additional Section 80CCD(2) deduction up to 14% of basic + DA, which works under both tax regimes.
The accumulation return depends on your asset mix. PFRDA caps equity at 75% till age 50; the "Auto" lifecycle mode shifts toward debt as you age, which lowers the effective return in your final accumulation years. For projections, use 10% as a balanced default.
How to use
- Enter your current age and retirement age (default 60). You can extend NPS contributions till 75.
- Set your monthly self contribution — minimum ₹500 to keep the account active, but ₹2K-5K is more typical for retirement-relevant accumulation.
- If your employer offers NPS under 80CCD(2), enter the monthly contribution. This is essentially free deduction over and above 80C.
- Choose an expected return: 8% conservative, 10% balanced (75% equity in early years), 12% aggressive.
- Pick an annuity rate (default 7%). Run scenarios with 6% to stress-test — annuity rates can drop in low-interest-rate environments.
- Read the corpus, lump sum, and monthly pension. Compare against the PPF Calculator with the same monthly contribution to see which retirement vehicle wins for your situation.
Frequently asked questions
What is NPS?
NPS (National Pension System) is a voluntary, defined-contribution retirement scheme run by PFRDA. You contribute monthly; the corpus is managed across equity, corporate debt, and government bond funds based on your chosen mix. At age 60, 60% can be withdrawn lump-sum (tax-free) and the remaining 40% must convert to an annuity that pays a monthly pension for life.
How are NPS returns generated?
NPS Tier 1 lets you choose an asset mix across equity (max 75% till age 50), corporate debt, and government bonds. Long-run returns: equity-heavy mix ~10-12% CAGR, debt-heavy ~7-8%. Pick a Pension Fund Manager (SBI, HDFC, ICICI, Aditya Birla, LIC are common); fees are uniformly low across all PFMs.
Why do I have to convert 40% to an annuity?
PFRDA rules require at least 40% of the maturity corpus to be converted into a pension annuity at age 60. The annuity provides regular income for life, structured similarly to a pension. You can pick the type — lifetime annuity for self only (highest payout), joint with spouse, with or without return of purchase price (ROP).
What's the tax treatment?
Contributions: deductible under 80CCD(1) within the ₹1.5L 80C cap, plus an additional ₹50K under 80CCD(1B) — both Old regime only. Employer contribution under 80CCD(2) is deductible up to 14% of basic + DA, available in both regimes. Maturity: 60% lump sum is fully tax-free; 40% annuity is taxable as 'income from other sources' at slab rate when received.
Can I withdraw NPS before age 60?
Premature exit before 60 requires 80% of the corpus to convert to annuity (only 20% tax-free lump sum). Partial withdrawals up to 25% of contributions are allowed after 3 years for specific reasons (kids' education or marriage, home purchase, medical emergency, disability). For most people, treat NPS as fully locked till 60.
What's a typical annuity rate in India?
6-7% per annum is common for life-only annuity from major Indian ASPs (LIC, HDFC Life, SBI Life, ICICI Pru, Bajaj Allianz). Joint-life annuities and those with return-of-purchase-price pay 0.5-1% lower. Higher rates exist but often skip the ROP — meaning when you and your spouse die, no money goes to heirs.
Is NPS better than PPF?
Different goals. PPF: 7.1% fixed, 15-year flexible lock, full EEE, fully liquid at maturity. NPS: market-linked higher expected return (~10-11%), locked till 60, 40% mandatory annuity. NPS wins on return potential and the extra ₹50K deduction; PPF wins on simplicity, certainty, and full liquidity. Most thoughtful Indian investors use both.
How do I open an NPS account?
Online via eNPS (enps.nsdl.com or the official NPS Trust website). You'll need PAN, Aadhaar, bank details, and a small initial contribution (₹500 minimum). Pick a PFM and asset allocation (or use the lifecycle 'Auto' option — it shifts equity exposure down with age automatically). Annual maintenance is minimal.