NPS Benefits: Inflation is skyrocketing these days. The common man is troubled by the price of petrol and diesel. The prices of oil and vegetables have spoiled the budget of the kitchen. In such a time when inflation is increasing day by day, it is natural to be worried about the future, especially the life after retirement. However, there are many solutions available, which not only beat inflation, but can also make you a millionaire in a few years.
Earlier only these people were benefitted
NPS means National Pension System is one such scheme. National Pension System is a government retirement scheme. It was launched by the Central Government on January 01, 2004 for government employees (except armed forces). Later this scheme was also opened for the employees working in the private sector. Along with investing in it, you can also take advantage of tax exemption.
These are the benefits of NPS
Investing in NPS should be done keeping in mind the long term. The main goal of NPS is to help individuals create a retirement corpus and a source of fixed income every month. Any citizen of India who is above 18 years of age can join NPS. Under this, two types of accounts can be opened – Tier 1 and Tier 2. The initial investment in Tier 1 is a minimum of Rs 500. There are two ways to open an NPS account, online and offline.
Better options for these works
The objective of NPS is to accumulate funds for retirement. NPS is currently giving decent returns more than the inflation rate. In this, pension fund managers invest for you in instruments like equity, corporate bonds and government securities. This is a long term plan. Equity gives you good returns in the long term. NPS is a good product for retirement.
If you are 30 years old now and you want to retire after next 30 years i.e. at the age of 60 years, then this scheme can help you Is. If you invest Rs 5,000 every month in NPS from now, you can easily build up a corpus of over Rs 1 crore by retirement.
Calculation to become a crorepati with NPS:
< p>Investor’s age: 30 years
Retirement age: 60 years
Monthly investment in NPS: Rs 5,000 (Rs 60,000 annually)
Total contribution in 30 years: Rs 18 lakh
Estimated Return on Investment: 10%
Total Pension Wealth at Maturity: Rs 1.11 Crore
Interest on Investment: Rs 93.9 Lakh
Annuity Purchase: 50%
Estimated Annuity rate: 6%
Pension at 60: Rs 27,996 per month
(This calculation is an approximate figure, the actual figure may be different.)< /p>.
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