If you are a job holder, then you must be worried about your future. Often the thought must come to mind that after retirement i.e. after the age of 60, there will be no job, then how will the daily expenses be dealt with? This is the reason why people do retirement planning. Some people start retirement planning very early, but some people are late in planning.

For this, you have to think from now on how much money is needed and where to invest the money. The best option for retirement planning is NPS (National Pension System), by investing a little bit, you will get a lot of money on retirement. Let us understand if you do retirement planning at the age of 40, then how much money will you have to invest every month, so that you can get a pension of about Rs 1 lakh on retirement?

Plan like this at the age of 40

Let's assume that you want to get a pension of Rs 1 lakh on retirement i.e. at the age of 60. In such a situation, even if you are 40 years old, it is not too late. If you take an annuity plan with all the money deposited till the age of 60, so that you can get a pension, then you will need about Rs 1.85 crore at that time. Here it is believed that you will get interest at the rate of 7 percent per annum on this money.

A corpus of ₹ 1.85 crore will be accumulated.

To create a corpus of Rs 1.85 crore, you will have to invest about 12 thousand rupees every month. At the same time, you will also have to increase your investment by 10 percent every year. If you get a return of about 10 percent annually on investment, then in the next 20 years i.e. by the time you turn 60, you will have a corpus of Rs 1.85 crore.

You will get a pension of Rs 1.07 lakh every month.

Now let us assume that you invest all your money in an annuity plan to use it for a pension. You will get an average return of 7 percent in the annuity plan. In this way, you will get a pension of about Rs 1.07 lakh every month.

Disclaimer: This content has been sourced and edited from Zee Business. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.