The National Pension System (NPS) is one of the most secure vehicles of investing to ensure a financially secure post retirement phase of life. Investing in your wife’s NPS account makes a lot of sense to build a retirement corpus which is capable to providing life-long financial stability to the family.
How to Open an NPS Account for Your Wife
The first step is to open an NPS account in your wife’s name. If she is 30 years old, you can invest ₹ 5,000 which can be ₹ 60,000 per year on a monthly basis. In total you will have invested ₹18 lakh within 30 years. But the significant benefit that comes out of this often overlooked as the realization of compound returns over the year.
The Investment Potential and the Potential Returns
tate that an investment of ₹5000 per month for 30 years in NPS will amount to ₹1,76,46,810 at an assumed average absolute return of 12% earned per annum. From this, interest only revenue of ₹1.05 crore will be attracted purely out of the interest component over the period of time. Because of this large return, NPS is suitable for long-term investment planning.
Lump Sum and Pension Benefits
At maturity of the NPS account, after your wife turns 60, she will get ₹1.05 crore in cash. Also, the corpus of 40 percent or ₹70.59 lakh will be funded in an annuity plan. This plan then guarantees that she is able to be paid a certain amount of pension for the rest of her life.
Monthly Pension Calculation
By investing ₹70.59 lakh in an annuity plan that will give an estimated return rate of 8%, one can get pension of about ₹46066 per month. This means that b your wife will have a lump sum on the final period of the investment as well as being suited providing her with monthly income during her retirement.
A Financially Secure Future
Every time you put in a little bit and contribute to the NPS regularly, you’re securing her financial independence. The great retirement amount together with pension income will provide families with the necessary financial security in the future. Smartly efficient and systematically proving as the best retirement planning tool the National Pension System has all the makings to dominate over other pension plans.
