If you also do a private job, this news can be very important for you. We will tell you here how you can know how much pension you will get after retirement.
Pension is provided after retirement through EPFO (Employees’ Provident Fund Organization) for private jobs. This is called EPLOYEES ‘Pension Scheme. If you want to know how much pension will be received after retirement, then we will tell you its calculation method.
How much does EPF contribute every month?
EPS is a retirement scheme that is managed by EPFO itself. The basic salary of employees working in the private sector and a 12% amount of DA (DA) are deposited in EPFF every month in EPLYEES ‘Provident Fund. With this, the company or employer also collects the same amount, but the employer’s share is divided into two parts:
8.33% amount goes to EPS
3.67% amount goes to EPF
How much pension will be received after retirement?
If you want to take advantage of pension facility, then your contribution to EPS should be at least 10 years. This means that your job duration must be at least 10 years. At the same time, the maximum pensionable service can be up to 35 years.
Now we tell you how you can calculate it, so that you can know how much pension you will get after retirement.
EPS Pension Calculation method
EPS pension is calculated on the basis of a formula. This formula is something as follows:
EPS = Average Salary × Pensitive Service / 70
Here, average salary means basic salary + DA, which is extracted on the basis of the last 12 months.
Suppose your pensionable salary is a maximum of Rs 15,000. Now according to this, the share of pension will be something like this:
15,000 × 8.33% = 1,250 rupees per month
If you have contributed for 35 years, pension calculation will be as follows:
EPS = 15,000 × 35 /70 = 7,500 rupees per month
In this way, under EPS you can get a maximum pension of up to Rs 7,500 and a minimum of Rs 1,000.
With the help of this formula, you can easily know how much pension you will get after retirement.
EPS rules
This formula of EPS applies to employees working in the organized sector after 15 November 1995. According to this, employees are entitled to pension only after the age of 58 years.
But if you decide to withdraw your pension amount before 58 years, then you get 4% less pension every year. At the same time, if you extract pension after 60 years, then you get 8% more pension than the general pension amount.
This makes it clear that if you withdraw your pension amount later, you will get more amount, which can make your post -retirement life more comfortable.
conclusion
If you also do private jobs and want to take advantage of pension after retirement, then you must have the right to know about the status of contribution to EPS and the correct information about pension calculation. With the help of this simple formula, you can know how much your pension will be after retirement.
In addition, if you contribute for a long time, the pension received after retirement can also be good, which will protect your financial condition. So, by understanding this information, you can make your financial plan stronger and prepare yourself for the coming time.
