EPFO Retirement Corpus: To live a tension-free life after retirement, it is important that you have adequate retirement funds. Apart from some regular monthly income or pension, you also need to have adequate retirement funds for those days. If you think about retirement from today, then a corpus of at least Rs 2 to 2.5 crores is required. This tension of yours can be removed by the Employees Provident Fund (EPF) account if you keep investing in it in a disciplined manner during your job. Now a question arises that how much retirement fund can you raise through this account. You can calculate it in a few minutes according to your basic salary.
What is EPF Account
Employees Provident Fund (EPF) is a retirement saving scheme, which is being run by Employees Provident Fund Organization (EPFO). EPF account has been designed keeping in mind the retirement of employees, so that financial security can be provided in the non-working year i.e. when you are not in job. In this scheme, the employee has to deposit a part of his salary, while the company also contributes the same amount as the contribution made by the employee. The amount of contribution is decided according to the salary structure. Currently the interest rate on this account is 8.25 percent per annum.
Rules for depositing in the account
For the EPF account, the employee has to contribute 12 percent of his salary which is made up of his basic salary and dearness allowance. The company or employer also contributes the same amount on its behalf. Out of the company’s contribution, 8.33 percent goes to EPS i.e. pension fund. At the same time, the company’s contribution to EPF is only 3.67 percent. In this way, by adding the amount of contribution of both, you can find out how much money will be deposited in the EPF account in a year.
EPF Calculator Will you get 2.5 crore funds from 35000 rupees basic
Suppose your age is 25 years and your basic salary and dearness allowance together is 35000 rupees.
Age of employee: 25 years
Retirement age: 60 years
Basic salary + DA: 35,000 rupees
Contribution from employee: 12%
Contribution from company: 3.67%
Early increment estimate: 5%
Interest on PF: 8.25% annually
Total contribution: Rs 63,07,473
Fund on retirement: Rs 2,53,46,410 (about Rs 2.53 crore)
If basic and dearness allowance is Rs 25000 at the age of 25
Age of employee: 25 years
Retirement age: 60 years
Basic salary + DA: Rs 25,000
Contribution from employee: 12%
Contribution from company: 3.67%
Early increment estimate: 5%
Interest on PF: 8.25% annually
Total contribution: Rs 45,05,360
Fund on retirement: Rs 1,81,04,488 (about Rs 1.81 crore)
