Planning for retirement is very important. One of the best ways to do this is through the National Pension System (NPS).
In this article, we’ll see how investing just a small amount every month can give you a steady income after retirement.
The big question is—if you invest ₹10,000 per month in NPS, how much pension will you receive?
1/6 – Let’s Do the Math with Some Assumptions
Let’s say you are 30 years old and start investing ₹10,000 every month in your NPS account.
That adds up to ₹1.2 lakh every year. Over the next 30 years, your total investment will be ₹36 lakh.
2/6 – The Investment Grows to ₹2.26 Crore
By the time you retire at age 60, your NPS investment would have grown to about ₹2.26 crore.
Out of this, around ₹1.90 crore would come from interest alone. This shows the power of compounding—where your money keeps earning more money over time.
3/6 – You’ll Have Two Options at Retirement
At retirement, you can either:
Invest the entire amount in an annuity plan to get a monthly pension, or
Withdraw 60% of the amount as a lump sum and invest the remaining 40% in an annuity (which is the minimum required by NPS rules).
For our example, we’re assuming an average annual return of 10% during the investment period.
4/6 – Pension If You Invest 40% in Annuity
If you choose to invest only 40% of your corpus (₹90,41,950) in an annuity, and the annuity gives 7–8% annual interest, you’ll receive a pension of about ₹6.33–₹7.23 lakh per year. That’s around ₹52,745 to ₹60,280 per month.
5/6 – Pension If You Invest 100% in Annuity
If you invest the full ₹2.26 crore in an annuity plan, your annual pension would be much higher.
At 7–8% returns, your yearly pension would be around ₹15.82–₹18.08 lakh. That’s a monthly pension of ₹1,31,860 to ₹1,50,700.
6/6 – Start Early to Get Bigger Benefits
This example assumes you start investing at 30 after getting a stable job. If you want to check how much pension you can get based on your age and investment, you can adjust the figures.
But remember—the earlier you start investing, the more money you’ll have at retirement.
