NPS Calculator
100% Private — Runs in Your BrowserEstimate the retirement corpus you'll build through the National Pension System, how much you can withdraw as a lump sum, and the monthly pension your annuity will pay.
How to use this calculator
- Enter your monthly contribution — how much you'll invest in NPS each month.
- Enter your current age — the calculator assumes retirement at 60.
- Set your expected annual return based on your asset allocation (8–9% conservative, 10–12% equity-heavy).
- Set the annuity portion (minimum 40%) and the annuity rate your insurer offers.
- Click Calculate to see your total corpus, tax-free lump sum, and estimated monthly pension.
How NPS works
The National Pension System is India's government-backed retirement scheme, regulated by the PFRDA. You open a Tier-1 account, contribute regularly until age 60, and your money is invested across equity (E), corporate bonds (C), and government securities (G) according to your chosen allocation. At 60, you withdraw up to 60% as a tax-free lump sum and use the remaining 40% (or more) to buy an annuity that pays you a monthly pension for life.
Worked example
A 30-year-old contributing ₹5,000 a month until 60 (30 years) at a 10% expected return builds a corpus of roughly ₹1.13 crore on total contributions of ₹18 lakh. Allocating the minimum 40% (₹45 lakh) to an annuity at 6% yields a monthly pension of about ₹22,600, while ₹68 lakh comes out as a tax-free lump sum. Starting just five years earlier, at 25, would push the corpus past ₹1.9 crore — a powerful illustration of why early NPS enrolment matters.
NPS tax benefits
NPS offers among the best tax breaks of any Indian investment. Contributions up to ₹1.5 lakh qualify under Section 80CCD(1) (within the overall 80C ceiling), plus an exclusive additional ₹50,000 deduction under Section 80CCD(1B) that no other instrument offers. For salaried employees, employer contributions up to 10% of basic salary (14% for government employees) are deductible under 80CCD(2) over and above these limits. At maturity, 60% of the corpus is tax-free; only the annuity income is taxed, at your slab rate when received.
NPS vs other retirement options
NPS has the lowest fund-management cost of any pension product in India (around 0.09%), strong tax benefits, and forced annuitisation that guarantees lifelong income. The trade-offs: your money is locked until 60, and at least 40% must go into an annuity whose rates (6–7%) are modest. Many financial planners suggest combining NPS (for its unique ₹50,000 deduction and disciplined structure) with equity SIPs (for liquidity and higher growth) — see our SIP guide for the comparison.
Disclaimer
This calculator provides estimates based on a constant assumed return. Actual NPS returns vary year to year and depend on your fund choice and asset allocation. Annuity rates change with market conditions. The 60/40 withdrawal split and tax rules are as of early 2026 and subject to PFRDA and Income Tax Department changes. This is not financial advice — consult a SEBI-registered advisor before making retirement decisions.
Frequently asked questions
What is the NPS?
The National Pension System is a voluntary, government-regulated retirement savings scheme in India. You contribute regularly during your working years; at retirement (age 60), you withdraw up to 60% as a tax-free lump sum and must use at least 40% to buy an annuity that pays a monthly pension.
What return does NPS give?
NPS returns depend on your asset allocation across equity, corporate bonds, and government securities. Historically, NPS funds have returned 9% to 12% for equity-heavy allocations and 8% to 9% for balanced ones. This calculator lets you set your own expected return.
How much pension will I get?
Your monthly pension depends on the annuity corpus (minimum 40% of your total NPS corpus) and the annuity rate offered by the insurer (typically 6% to 7% per year). This calculator estimates it based on the figures you enter.
What are the tax benefits of NPS?
NPS contributions qualify for deduction under Section 80CCD(1) within the 80C limit, plus an additional Rs 50,000 under Section 80CCD(1B). The 60% lump sum at retirement is tax-free; the annuity income is taxed at your slab rate when received.