EPFO Pension: If you are eligible to receive pension from EPFO after retirement, then you can know how much pension you will get with a simple formula. Here know the special things related to that formula and EPS pension?
EPFO Pension: Those doing private jobs are given pension facility by EPFO after retirement. Employee Pension Scheme i.e. EPS is a retirement scheme, which is managed by EPFO. 12 percent of Basic + DA of employees working in the organized sector is deposited in EPF every month. The same amount is also deposited by the employer / company. But the employer / company’s share is divided into two parts. 8.33% goes to the Employees Pension Scheme (EPS) and 3.67% goes to EPF every month.
However, to avail this pension facility under EPS, contribution to EPS for a minimum of 10 years is necessary, that is, the employee must have worked for 10 years. The maximum pensionable service is 35 years. Let us tell you the formula through which you can calculate how much pension you will get after retirement?
Understand the pension formula
How much pension you will get in EPS is calculated on the basis of a formula. This formula is- EPS= Average salary x Pensionable service/ 70. Here average salary means basic salary + DA. Which is calculated on the basis of last 12 months. The maximum pensionable service is 35 years. The maximum pensionable salary is Rs 15 thousand. Due to this, the maximum pension share is 15000×8.33= 1250 rupees per month. In such a situation, if we understand the EPS pension calculation on the basis of maximum contribution and years of service, then – EPS = 15000 x35 / 70 = Rs 7,500 per month. In this way, the maximum pension from EPS can be Rs 7,500 and the minimum pension can be up to Rs 1,000. You can also calculate your pension amount through this formula.
Remember here that this formula of EPS will be applicable to employees working in the organized sector after 15 November 1995. There are different rules for employees before this. On the other hand, the demand is being constantly made by the employee organizations that the maximum limit of average salary for pension should be increased in view of the current wage structure and inflation rate.
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Also know this rule related to pension
Let us tell you that under the rules of EPS, the employee is entitled to pension at the age of 58 years. However, if he wants, he can get pension even before 58. For this, there is also an option of Early Pension, under which pension can be received after 50 years. But in this case, the earlier you withdraw money from the age of 58, the lesser will be your pension at the rate of 4 percent for every year. Suppose you withdraw monthly pension at the age of 56, then you will be given 92 percent of the basic pension amount as pension. On the other hand, if you start taking pension at the age of 60 instead of 58, then you will get 8 percent more money as pension than the normal pension amount. In this, the pension will increase at the rate of 4 percent for every year.
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