NPS annuity vs lump sum
At 60 you must put at least 20% of your NPS into an annuity. How much more should you? Compare a fixed pension with investing the lump sum yourself.
About ₹54,167 a month to start
₹10,833 from the annuity (fixed, for life) plus ₹43,333 drawn from the ₹80L lump sum, rising 5% a year. The lump sum runs out around 83; after that only the pension continues.
What each part pays to 85
The annuity is guaranteed for life but never rises. The lump sum can grow and rise with prices, and what’s left goes to your heirs, but it can run out.
The lump sum runs dry before the plan ends. Draw less, or put more into the annuity.
How this is calculated
The annuity pays 6.5% of what you put in, every year, for life. The lump sum is run as an SWP: withdraw monthly, grow the rest at 9%, raise the withdrawal 5% each year.
Non-government subscribers can take up to 80% as a lump sum (December 2025 rules). Returns on the lump sum are assumed steady; the Monte Carlo SWP calculator shows how bumpy markets change that. Tax on the pension isn’t modelled.