Most calculators ask how much you will invest. The NPS contribution calculator works the other way: tell it the monthly pension you want (in today’s rupees), and it tells you the corpus required, the annuity you will need and the monthly NPS contribution to start now.
Example: Rs. 30,000 a month pension in today’s money
A 30-year-old who wants a pension worth Rs. 30,000 today will need about Rs. 1.72 lakh a month at 60 after 6% inflation. With 40% annuitised at 6.5%, that needs a corpus of about Rs. 7.95 crore, or a monthly NPS contribution of about Rs. 34,890 at 10% return. Raising the annuity share to 100% cuts the corpus needed to about Rs. 3.18 crore, but leaves no lumpsum.
A 10% yearly step-up brings the starting contribution down sharply. So does planning to keep working part-time or deferring exit beyond 60, since NPS now allows you to stay invested till 85.
NPS contribution rules
- Tier I minimum: Rs. 500 at opening, Rs. 1,000 per financial year.
- No maximum, but tax benefits are capped (see NPS tax benefits).
- Government employees: 10% of Basic + DA from the employee and 14% from the Government, by payroll.
- Corporate NPS: employer contribution as agreed in your CTC; deductible up to 14% of Basic + DA.
- Contributions can be made through net banking, UPI, D-Remit, or your Point of Presence.
Frequently asked questions
How much should I contribute to NPS every month?
Enough to reach your target pension. Use the calculator with your own target. As a rule of thumb, aim for 10% to 15% of take-home pay across all retirement savings.
Can I change my NPS contribution amount?
Yes, at any time. Voluntary contributions are fully flexible above the yearly minimum.
What is D-Remit in NPS?
Direct Remittance gives you a virtual account to transfer contributions so units are allotted the same day (T+0) if funds reach before the cut-off.