More than the earning of money, it is its management that requires wisdom, skill, and prudence. An integral component of money management is investing and saving. A pension is a fund in which you deposit a certain sum at regular intervals during your employment years and eventually withdraw in installments after retirement or in old age.
Calculating anything manually in today’s day and age is not only tedious and something you want to avoid (like earlier) but also a waste of time and effort. In a digital age like the one that exists today, you have simple online tools to facilitate such calculations.
For example, if you were to calculate your future pension manually; you’d use the following method:
Future Pension= Average Salary * Pensionable Service / 70 where, Average Salary means the average of the Basic Salary + DA combined, drawn in the last 12 months, and. Pensionable Service means the number of years worked in the organized sector after a certain year.
While the online tool is far simpler. The national pension calculator illustrates the tentative Pension and Lump Sum amount an NPS subscriber can expect on maturity or 60 years of age based on regular monthly contributions, percentage of corpus reinvested for purchasing an annuity, and assumed rates in respect of returns on investment and annuity selected for.
The following fields must be filled in by the subscriber to use the pension calculator:
- Date of Birth
- Amount to be contributed per month
- Number of years for which contributions will be made
- Expected ROI from subscriber’s perspective
- The stake that the subscriber would purchase an annuity for
- Expected Annuity Rate
Therefore, a mere entering of factual and certain financial estimates can give one the exact status of future funds if one were to take a pension. This not only allows an employee to make provisions for short-term finances by knowing the contributions but also assists him/her inefficient retirement planning. It helps senior citizens choose the best FD scheme for themselves.
Apart from pensions, while managing your funds you can look at other instruments like FDs too. An FD (Fixed Deposit) allows you to earn a fixed interest on a compounded basis for a fixed time period. In such a scenario, another useful online tool is an FD calculator.
This tool assists you to get an indicative estimate of the wealth you’d accumulate on the basis of current interest rates, the amount you’re investing, and the tenor for which you are parking your funds in the FD. You can find one on the Bajaj Finserv website. This helps you decide which is the best FD choice for you, especially if you’re a senior citizen and need assurance as well as credibility.
Thus, in a highly advanced age of technology, the consumer can easily use the pension calculator and especially the FD calculator to choose the best FD schemes, for senior citizens too.
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