Plan your National Pension System investment: projected retirement corpus, expected monthly pension from the annuity, and the extra ₹50,000 deduction u/s 80CCD(1B) over and above 80C — with tax saved at your slab.
Contributions up to ₹50,000/year to NPS Tier-I get a deduction u/s 80CCD(1B) — over and above the ₹1.5 lakh 80C limit (old regime). At the 30% slab that's up to ₹15,600 extra tax saved every year. Employer NPS contribution u/s 80CCD(2) (up to 14% of basic) is deductible in both regimes.
You can withdraw up to 60% of the corpus tax-free. At least 40% must buy an annuity that pays your monthly pension (pension is taxable as income).
NPS invests in equity (E), corporate bonds (C) and government securities (G). Long-run blended returns have been roughly 9–11% for aggressive allocations; we default to 10% — change it to be conservative.
Disclaimer: projection with constant returns; actual NPS returns vary with markets and your E/C/G allocation. Pension figures are pre-tax.