Question 1

What returns does NPS give?

Accepted Answer

NPS is market-linked, not a fixed rate. Depending on your equity-debt mix, the Tier-I scheme has historically delivered roughly 9–12% per annum on equity and around 8–10% blended over the long run. Because returns vary with markets, this calculator lets you set an expected return so you can model conservative and optimistic scenarios.

Question 2

How much of the NPS corpus can I withdraw at 60?

Accepted Answer

At 60 you can withdraw up to 60% of the corpus as a tax-free lump sum, and you must use at least 40% to buy an annuity that pays a monthly pension for life. The pension income from the annuity is taxable in the year you receive it. This calculator splits your projected corpus into the 60% lump sum and the 40% annuity and estimates the resulting pension.

Question 3

What are the NPS tax benefits?

Accepted Answer

Under the old regime, NPS offers a deduction of up to ₹1.5 lakh under Section 80CCD(1) (within the overall 80C limit) plus an exclusive additional ₹50,000 under Section 80CCD(1B). Employer contributions under 80CCD(2) — up to 14% of salary for government and 10–14% for others — are deductible under both the old and new regimes. The extra ₹50,000 under 80CCD(1B) is available only in the old regime.

Question 4

Is NPS better than PPF or EPF?

Accepted Answer

NPS typically offers higher long-run returns than PPF or EPF because of its equity exposure, but with market risk and a mandatory annuity at retirement. PPF and EPF are fully safe and tax-free but lower-yielding. Many investors use all three: EPF/PPF as the safe base and NPS for growth plus the extra ₹50,000 tax deduction.

NPS Calculator

Calculation Methodology & Formulas

Real-World Compounding Projections

₹5,000/month from age 30 to 60 at 10%

Frequently Asked Questions (FAQ)

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