NPS Monthly Amount: Start With ₹4,000–5,000
How much to invest in NPS every month depends on income, retirement goal, and 80C utilisation. A common starting point: ₹4,000–5,000/month (₹48–60K/year). This hits the 80CCD(1B) ₹50K limit for extra tax benefit. If you have headroom and want more corpus, go up to ₹10,000–15,000/month. This guide explains factors, tax benefit, allocation by age, and how to use our NPS Calculator to plan.
Key Takeaways
- ₹4,000–5,000/month: Covers 80CCD(1B) ₹50K. Good starting point
- 5–10% of salary: Rule of thumb. More if young, less if other 80C full
- 80CCD(1B): ₹50K extra deduction. Saves ~₹15K tax at 30% slab
- Step-up: Increase 10% every year or with salary hike
- Use NPS Calculator: Enter amount, tenure, return. Get projected corpus
Factors That Affect NPS Amount
- Income: Higher income = more capacity. Aim 5–10% of take-home for NPS.
- Age: Younger = longer horizon. Can invest more in equity, smaller amount needed for same corpus.
- 80C status: If EPF + ELSS already fill ₹1.5L, NPS 80CCD(1B) ₹50K is pure add-on. Plan for it.
- Retirement goal: Target corpus ÷ years to retirement ÷ 12 ≈ monthly need. Adjust for EPF and SIP.
- Risk tolerance: Higher equity = higher volatility but potential return. Choose allocation accordingly.
Tax Benefit: Why ₹50K Matters
80CCD(1B) gives an extra ₹50,000 deduction over and above 80C. So you can do full EPF, ELSS, PPF in 80C (₹1.5L) and still add ₹50K in NPS for extra deduction. At 30% slab, ₹50K saves ₹15,000 tax. Effective investment = ₹50K − ₹15K = ₹35K. That's 30% discount. So investing ₹4,167/month (₹50K/year) in NPS is tax-efficient. Don't miss it if you're in 20% or 30% slab.
Allocation by Age
📊 Illustrative monthly NPS (Tier I)
Example: ₹5,000/Month for 25 Years
At 10% return (equity-heavy allocation), ₹5,000/month for 25 years grows to ~₹65 lakh. At 9%, ~₹56 lakh. Add EPF and SIP—total corpus can cross ₹2–3 crore. Use NPS Calculator to run your numbers with your amount, tenure, and expected return.
Step-Up With Salary
When you get a raise, add 50% of the increment to NPS. If salary goes from ₹80K to ₹88K, add ₹4,000 to NPS. This builds corpus without feeling a pinch. Review annually and increase contribution. NPS allows flexible contribution—you can add lump sum or increase monthly amount anytime.
Use Our NPS Calculator
Enter monthly amount, years to retirement, expected return. Get projected corpus. Adjust to meet retirement goal.
Disclaimer
NPS returns are market-linked and not guaranteed. Past performance doesn't guarantee future results. Choose allocation based on risk tolerance.