A question definitely comes in the mind of private employees that how much more or less pension do they get compared to those doing government jobs. Subscribers to the Employee Provident Fund for private employees get pension benefits under the Employee Pension Scheme (EPS). Some part of the employee’s salary is automatically deposited in his EPF account every month.
The company also deposits the same amount in the employee’s EPF every month. Your company adds 8.33% of basic salary + DA to EPS, but the maximum limit remains only Rs 15,000.
It is necessary to work for 10 years for pension
After retirement, the employee gets pension every month from the amount deposited in the EPS account and this scheme is run under EPFO. To get pension, the employee must be 58 years of age and have been employed for at least 10 years. If someone wants to take pension at the age of 50, he can get it but the amount will be less than the actual pension. If you leave the job before completing 10 years of service, you will not get pension every month, rather the entire amount deposited in EPS will be given in lump sum at the time of retirement.
After retirement, the employee gets pension every month from the amount deposited in the EPS account and this scheme is run under EPFO. To get pension, the employee must be 58 years of age and have been employed for at least 10 years. If someone wants to take pension at the age of 50, he can get it but the amount will be less than the actual pension. If you leave the job before completing 10 years of service, you will not get pension every month, rather the entire amount deposited in EPS will be given in lump sum at the time of retirement.
How much salary will you get every month after 30 years?
The employee’s pension amount is calculated using a simple formula. The average basic salary of the last 60 months is multiplied by the total years of service, then that number is divided by 70, the result is the pension for each month. That means, the more years you have worked and the higher your last salary, the bigger will be the pension you will get.
The formula of EPFO pension is very easy to understand. In this (pension salary × pension service) / 70 and pension salary means the average of basic salary + DA of the last 60 months, and pension service means the total number of years of service. By just doing this calculation, every month’s pension is arrived at. The minimum monthly pension is ₹1,000.
If your pension salary is ₹ 25,000 and assuming your pension service is 30 years, then monthly pension = (₹ 15,000 × 30) / 70. In this case, monthly pension = ₹ 150,000 / 70, that is, after retirement, you will get monthly pension of ₹ 6,428 per month.
Who will get the money if the employee dies?
If an employee of a private company who is in EPS (Employee Pension Scheme) dies, his family gets family pension every month. Wife, husband, children or orphans can get this pension. According to the EPFO website, to get pension, the family member or nominee has to fill Form 10D or Composite Claim Form through the last company and submit it to the EPFO office along with all the documents.
The purpose of family pension is that even after the departure of the employee, there is no financial problem in his house. That’s why experts say that while changing jobs, never withdraw EPF money, rather get it transferred to the new company. Due to this, the years of old service are added to the new service and the total service period increases, due to which the pension is also higher later. If you take care of small things, your family will get great security.
