NPS Calculator

How NPS Calculator Works

The NPS (National Pension System) Calculator is a tool designed to help you plan your retirement efficiently. By entering your contributions, expected returns, and personal details, it estimates your retirement corpus, total contributions, tax savings, and provides a year-wise growth breakdown. This allows you to make informed investment decisions.

Input Fields Explained:

Monthly/Annual Contribution: The amount you plan to invest regularly in NPS. Can be monthly or annual.
Expected Annual Return (%): The projected growth rate of your NPS investment, based on historical fund performance.
Employee Contribution Type: Tier 1 (retirement-focused, partially locked) or Tier 2 (liquid, flexible withdrawals).
Current Age: Your present age to calculate the duration of contributions till retirement (default retirement age is 60).
Contribution Frequency: Select whether contributions are made monthly or annually.

Output / Calculated Fields:

Total Contribution: Sum of all contributions over the investment period. For monthly contributions, it's Monthly Contribution × 12 × Years.
Estimated Corpus at Retirement: Future value of contributions using the compound interest formula: FV = P × [(1 + r)^n - 1] / r where P = periodic contribution, r = periodic rate, n = number of periods.
Tax Savings: Tier 1 contributions are eligible under Sec 80C (up to ₹1.5L) and Sec 80CCD(1B) (up to ₹50,000).
Total Wealth Accumulated: Total contributions plus gains from investments.
Breakdown Table: Year-wise breakdown showing contribution, interest earned, and cumulative corpus.

Example:

Let's assume:

Monthly Contribution: ₹10,000
Expected Annual Return: 10%
Employee Contribution Type: Tier 1
Current Age: 30 years
Contribution Frequency: Monthly

Over 30 years (till age 60), the Total Contribution would be ₹10,000 × 12 × 30 = ₹36,00,000. Using the compound interest formula, the Estimated Corpus at retirement would be approximately ₹1.47 crore. Tax Savings under Sec 80C + 80CCD(1B) could be up to ₹2,00,000 annually. The year-wise table allows tracking of how the investment grows each year.

Why Use the NPS Calculator?

To plan your retirement corpus accurately and make informed contribution decisions.
To evaluate the effect of contribution frequency, contribution type (Tier 1 vs Tier 2), and expected returns.
To understand the impact of tax savings and how much you can save under Sec 80C/80CCD.
To visualize growth year by year, enabling better financial planning for long-term goals.

Tips:

Start investing early to take full advantage of compounding.
Regularly review and update expected return assumptions to stay on track with your retirement goals.
Consider additional voluntary contributions to maximize tax benefits and corpus growth.