20.1 C
New Delhi
Thursday, March 23, 2023
HomeFinanceHow does EPF calculator works; how to get Rs 7,071 as monthly...

How does EPF calculator works; how to get Rs 7,071 as monthly pension after retirement: EPFO

You can undoubtedly monitor where your well deserved cash is being put away and how much premium it has gathered once you begin using PF number cruncher in India.

The majority of private sector employees are eligible to receive post-retirement benefits if they work in the organized sector. Be aware that government employees are eligible for pensions in addition to their counterparts in the private sector. The Employee Provident Fund was established after Parliament approved the EPF Act.

The Employees Provident Fund Organization of India (EFPO), which is identified by a UAN, or Unique Account Number, is in charge of the money that is put into a permanent account by both the employer and the employee, as stipulated by the law. Using an EPF calculator, you can accurately determine how much money you have saved.

EPF: What is it?
Employers and employees alike contribute to the retirement savings system known as EPF, which is also referred to as PF (Provident fund). Employers with at least 20 employees are required to offer EPF accounts to their employees. However, some companies with fewer than 20 employees may also assist their employees in opening EPF accounts.

How does EPF function?
The EPF requires employees to contribute 12% of their basic and dearness pay each month. The employer contributes similarly and matches this payment. The Employee Pension Fund receives 3.67 percent and the Employee Pension Plan receives 8.33 percent of the 12%. Nevertheless, the EPF receives 12 percent of the employee’s total contribution.

How does an EPF calculator work?
The EPF or PF calculator is a financial tool that shows you how much money is in your EPF account when you retire. You can figure out how much money has accumulated in your EPF account, including the contributions you and your employer have made and any interest that has been earned.

The only information you are required to provide is your age, basic monthly pay, PF contribution percentage, employer contribution percentage, anticipated average annual salary increase percentage, retirement age, and interest rate. After providing all of the necessary information, you can determine how much you could save for retirement.

Employees can contribute up to 12% of their Basic Salary plus their Dearness Allowance to their EPF account. The employer contributes the same amount of 12%, with 8.33% going to EPS and 3.67% to the employee’s EPF account.

“Pensionable Salary X Pensionable Service)/70” is the EPS pension formula.

The EPS pension is calculated using the average pensionable salary for the previous 60 months as of the retirement date if you choose not to choose the higher pension. For instance, if you began working for EPS at the age of 25 and retired at the age of 58, you might be eligible for a monthly pension of Rs. 7071 [(Rs. 1500033)/70].


Our Archieves