NPS Calculator: frequently asked questions
Straight answers to the questions people ask most about the NPS Calculator.
What is the standard NPS contribution?
The standard split is 10% of basic salary plus D.A. from the employee and 10% from the employer, giving the 10%+10% contribution that the calculator models.
What is the 80CCD(1B) deduction?
Under Section 80CCD(1B), you can claim an additional deduction of up to 50,000 per year for your NPS contributions on top of the 1.5 lakh Section 80C limit. The calculator reflects this added tax benefit.
Do I have to buy an annuity at maturity?
Yes. At retirement you must use a portion of your NPS corpus to purchase a mandatory annuity that provides a monthly pension. The calculator includes an estimate of this annuity portion and the pension it could generate.
How are NPS assets invested?
NPS invests your contributions across equity, corporate bonds, and government securities. Your choice of equity and debt allocation affects the expected return used in your corpus projection.
Is the annuity estimate reliable?
The annuity estimate is a projection based on the assumed annuity rate at retirement. Actual annuity rates change with the market, so treat it as a planning figure rather than a guaranteed pension.
Verdict
If you were unsure about the NPS Calculator, now you know: it projects your corpus with the 10%+10% split, the 80CCD(1B) benefit, and an annuity estimate. Start at NPS Calculator.