1. What is NPS with Increasing Contribution?

The National Pension System (NPS) is a voluntary retirement savings scheme. This calculator helps estimate your corpus when you plan to increase your contributions annually, accounting for compounding returns.

2. How Does the Calculator Work?

The calculator uses the formula:

Where:

• \( contrib_i \) — Contribution in year i (increasing annually)
• \( r \) — Expected annual return rate
• \( t \) — Total investment period in years

Explanation: Each year's contribution grows at the specified rate, and each contribution compounds until retirement.

3. Importance of NPS Calculation

Details: Calculating future corpus helps in retirement planning, ensuring you save enough to maintain your lifestyle after retirement.

4. Using the Calculator

Tips: Enter your initial contribution, expected annual increase percentage, investment period, and expected return rate. All values must be positive.

5. Frequently Asked Questions (FAQ)

Q1: What is a good annual increase rate for contributions?
A: Typically 5-10% to keep up with inflation and salary growth, but depends on your financial situation.

Q2: What return rate should I expect from NPS?
A: Historically 8-10% for equity, 7-8% for corporate bonds, and 6-7% for government securities.

Q3: Can I change my contribution increase rate later?
A: Yes, NPS allows flexibility in contribution amounts and frequency.

Q4: Are there tax benefits on increased contributions?
A: Yes, additional contributions up to ₹50,000 under Section 80CCD(1B) are eligible for tax deduction.

Q5: What if I can't increase contributions every year?
A: The calculator shows ideal growth. Even without annual increases, regular contributions help build retirement corpus.