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NPS Calculator

Calculate NPS corpus, 60% lump sum, and estimated monthly pension.

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Typical range: 5–7%

How the NPS calculator works

The calculator uses the future value of an annuity-due formula (contributions at the beginning of each period) to project the corpus at retirement. The monthly rate is derived from the expected annual return. At retirement, 60% is taken as lump sum and 40% is used to calculate the monthly pension based on your chosen annuity rate.

NPS vs PPF vs ELSS — which is better?

  • NPS: Best for retirement corpus + pension. Extra ₹50,000 deduction. Lower liquidity. Market-linked returns (8–12% historically).
  • PPF: Safe, sovereign-guaranteed at 7.1%. Full EEE tax treatment. ₹1.5L annual limit. 15-year lock-in with partial withdrawals.
  • ELSS: Highest growth potential (12–15% CAGR). Shortest lock-in of 3 years. Subject to LTCG tax above ₹1L gains. No pension component.

For most salaried individuals, a combination of all three provides both tax efficiency and diversification.

Frequently asked questions

What is NPS?
The National Pension System (NPS) is a voluntary, long-term retirement savings scheme regulated by the Pension Fund Regulatory and Development Authority (PFRDA). It is open to all Indian citizens aged 18–70. Contributions are invested in a mix of equities, corporate bonds, and government securities, and the corpus grows until retirement.
How does NPS work at retirement?
At the age of 60, you can withdraw up to 60% of the total NPS corpus as a tax-free lump sum. The remaining 40% must be used to purchase an annuity plan from an PFRDA-empanelled life insurance company. The annuity provides a regular monthly pension for life.
What are the NPS tax benefits?
NPS offers three layers of tax benefit: (1) Up to ₹1,50,000 under Section 80C, (2) An additional exclusive deduction of ₹50,000 under Section 80CCD(1B), and (3) Employer contributions up to 10% of basic salary are deductible under 80CCD(2). The 60% lump sum withdrawal at maturity is tax-free. This makes NPS one of the most tax-efficient investment instruments available.
What is an annuity in NPS?
An annuity is a contract where you pay a lump sum to an insurance company in exchange for a regular income (pension) for life. The annuity rate (typically 5–7% p.a.) determines how much monthly pension you receive. Different annuity options are available — life annuity, joint life annuity (covers spouse), annuity with return of purchase price, etc.
What is the difference between NPS Tier 1 and Tier 2?
Tier 1 is the mandatory pension account with lock-in until age 60 (with limited partial withdrawals allowed after 3 years). All tax benefits apply only to Tier 1. Tier 2 is a voluntary savings account with no lock-in — you can withdraw anytime. Tier 2 has no tax benefits under the old tax regime (except for central government employees).

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