National Pension System: NPS is a market linked retirement oriented investment option. Under this scheme, NPS money is invested in two places, Equity i.e. Stock Market and Debt i.e. Government Bonds and Corporate Bonds.
New Delhi: National Pension System: If you want to live your old age without worry, then you should start planning for retirement from the beginning of the job. With this you can accumulate a good amount till retirement. National Pension System is one such option where you can invest and secure your retirement. Under this, you can arrange monthly pension along with lump sum amount.
Will be a millionaire till retirement!
If you want to save only Rs 74 a day and put it in NPS, then you will have Rs 1 crore in your hands till retirement. If you are young and you are 20 years old, then you can start planning for your retirement from now, although people usually do not work at this age. Still, saving Rs 74 a day is not a big deal.
Investing in NPS will make you a millionaire
NPS is a market linked retirement oriented investment option. Under this scheme, NPS money is invested in two places, Equity i.e. Stock Market and Debt i.e. Government Bonds and Corporate Bonds. You can decide how much of NPS money will go into equity only during account opening. Usually up to 75% of the money can go into equity. This means that in this you are expected to get slightly higher returns than PPF or EPF.
Easy way to become millionaire
Now if you want to become a millionaire through NPS, then its method is very easy, just a little trick is needed. Suppose you are 20 years old at this time. If you invest in NPS by saving Rs 74 for the day i.e. Rs 2230 for the month, then you can do this. That is, when you retire after 40 years, you will be a millionaire. Now suppose you got a return at the rate of 9%. So when you retire, your total pension wealth will be Rs 1.03 crore.
Start investing in NPS
- Age 20 Years
- Investment Per Month Rs 2230
- Investment Duration 40 Years
- Estimated Return 9%
Book keeping of NPS Investments
- Total invested Rs 10.7 lakh
- Total interest received Rs 92.40 lakh
- Pension wealth Rs 1.03 crore
- Total tax savings Rs 3.21 lakh
Now you cannot withdraw all this money at once, you can withdraw only 60 percent of it, the remaining 40 percent you have to put in an annuity plan, from which you get pension every month. Suppose you put 40 percent of the money in the annuity. So when you are 60 years old, you will be able to withdraw a lump sum amount of 61.86 lakhs and assuming the interest is 8%, then every month pension will be around 27500 thousand rupees, that is different.
Pensions accounted
- Annuity 40 percent
- Estimated interest rate of 8 per cent
- Lump sums received 61.86 million
- Monthly pension of Rs 27,496
- Although it is a market linked product, it is possible to change its returns. The mantra of any investment is to start investing in it early.
