How much pension will I get from the NPS?

A question that pops up quite frequently in comments is how much pension will I get from NPS, and I think it’s not clear to a lot of people that the NPS itself won’t give them a pension.

There are two things that you need to keep in mind:

  • NPS doesn’t pay a pension directly.
  • There is no fixed rate at which your money will grow.

NPS doesn’t pay a pension directly

The way NPS works is that you invest regularly in the scheme and the scheme invests that money on your behalf.

At the age of 60 you will get the money and it will be up to you to invest it and generate an income for yourself. In this regard you can think of it more like a provident fund than a pension.

Under NPS there is no fixed rate at which your money will grow

When you open the NPS account – you will be asked to select a fund manager and your money will be invested by this fund manager. You will also be asked whether you want to choose an Ultra Safe, Safe or Medium approach, and based on your selection the fund managers will spread your money between debt and equity instruments. The rate of growth will depend on the performance of the fund managers and the choices you make, so to that extent it’s not like a bank fixed deposit where they tell you that you will get 8 or 9% interest regardless of anything else.

How to calculate pension amount from NPS?

Keeping these things in mind it should become clear that you can only get an idea of how much pension you can generate and not an accurate answer.

So, how do you get that idea?

Suppose you have the following question:

I am 28 years old – how much pension will I get if I invest Rs. 2,000 every month?

CAMS has got this great corpus calculator which allows you to input the parameters and tells you how much your final corpus will be.

In this case I’ll put in the following numbers:

  • Contribution Amount: 2000
  • Periodicity: Monthly
  • Rate of Interest: 9.5% (Assumed)
  • Number of Years: 32 (60 – 28)

The calculator shows me a value of Rs. 50,05,164.

Now, this is the amount that you will get at the end of 60 years, and you will have to invest it in order to get a pension. You could create a bank fixed deposit with it or buy an annuity. NPS requires  you to buy an annuity from 40% of your money in the Tier 1 account compulsorily, but there is no such restriction on the Tier 2 account, so you can keep that in mind while opening the NPS account.


The first thing you should keep in mind is that NPS won’t pay you a pension directly, the second point is that the rate of return is not fixed either, and the third thing is when you get the NPS money you will be free (to an extent) to invest it, and generate an income for you as you see fit.


55 thoughts on “How much pension will I get from the NPS?”

  1. R/Sir,
    Please give me details regarding how much money i will get after maturity of Pension.
    D.O.B – 20/09/1990
    Date of Enlishtment 23/12/2013
    Service up to 58 years.
    Year of retirement 2048
    Contribution per month is Rs. 3018 at this time. may be higher as the salary goes higher.

    Please tell me that how much money i get on retirement and how much pension i will get

  2. Sir I am govt employee.I invest 7000/- per month .my date of birth 24.04.1974.How much pension after retirement

  3. I am a state govt employee , I have completed 11 years of service , now I should open tire 2 account were should I go and open the account , i asked our office ppl their say v also don’t have the information let as wait and see
    Pls help

  4. I have 34 years old. I invest rs.50000/- per annum in nps at Allahabad Bank. Is 60% maturity amount is taxable.

  5. Sir I join jet teacher 5th Jan. 2011 salary 9300 -34800 -4200. I retire in April 2036. My date of birth 10-04 1978. How much pension after retirement.

  6. I am a Private Sector emplyee and i am working as accounts executive and i have ontribute Rs1000/- PM so i want to know after 60yrs the pension amount has been received in which period after 60years ,My Date of Birth is 17-04-1988, Kindly give me Suggesstion


  7. Suppose in NPS , the calculated value of annuty is 30,000 /- . This amount of 30,000 /- , for how many months I will receive ? Afterwards , for how many years my nominee will get ?

  8. I am a state govt. basic pay is 12200 and DA is contribution is 10 percent of 12200 plus service length is 33 years.what will be my total return from age is 34 yr.Job joining date is 2009.My date of birth is 1982.

  9. I Dilip Doley from Assam I am a Govt. serviceman I have opened PRAN account i.e New pension Scheme in FY 2009-2015. And till now I contributed 3000/pm . I have a PRAN Number But I can not internet access to know details statement against the deposited money from my salary Plz suggest me How to access internet to find above mentioned matters.

  10. I Dilip Doley from State of Assam I am a Govt. serviceman I have opened PRAN account i.e New pension Scheme in FY 2009-2015. And till now i contributed 3000/pm . I have PRAN Number But I can not internet access to know details statement against monthly deposited from my salary Plz suggest me what should i do

  11. NPS swabhilambhan.
    after 60 age received 60% of total maturity value this is true ?
    when my death is 62 so my nominee received pension?

  12. NPS should have been designed like PPF or EPF. Anyone interested in equity etc should not put money in NPS. Instead in equity market.

    NPS whole structure is confusing and there is no single point agency.
    You must be expert to choose your fund manager, then percentage or share in equity etc. , then no idea who will provide Pension.

    Govt is working for few companies. They collect your money, companies will do business, build assets and finally some company will provide pension and govt is not concerned about it.

    Govt is good at making rules only. Your money but their rules in favour of govt.

    Imagine a person who is not so literate, how will he know all this fund manager, then percentage of investment , then pension provider etc.

    if a poor persion knows so much, he would invest in PPF and after 15 years he will buy directly pension. Why this NPS?

    Govt can not do things simple. IT always makes rules to complicate and harass people.

    Let me tell you , whole country will be crying because of this kind of structure.

    Most of the wives will suffer.

    Govt is playing dangerous game with people to collect money for some companies and does not take responsibility when it comes to pay pension.

    A stock market game will be played with your money and finally if they fail, they will blame you for investing in it. Blame the victim.

  13. I want to calculate the maturity amount of NPS.
    if i invest 6000 pm till 30 years.
    and increase the investment by 10% each year
    like in first year invest 6000 pm
    in second year: invest 6600 pm and so on… till 35 years

  14. pretty good option, seems to be. around 10% interest rate with minimum 40% annuity is good. nominee option available, so if u die after investing till your 60th year, your nominee will get the pension/ lump sum amount. but if you die before 60, your nominee have to pay for the rest of years, to earn his/her pension. go for it….

  15. I am opening NPS a/c from last 26.06.2014 form The South Indian Bank Ltd and invest Rs. 1000/- per month, also received NPS statement on 19.06.2014 form Bank , this is very good option for pvt. company employee. So take it for tension free after retirement.

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