Pension Plan: Like government employees, those doing private jobs do not get the benefit of pension or other facilities. But by choosing the right retirement plan, the employee can avail pension even at the age of 58 years. In this, the pension scheme “Employee Pension Scheme” run by EPFO will help you. It can also be called EPS.
About the scheme
The benefits of EPS can be availed only by those people who have worked for 10 years. Only employees above 58 years of age can apply for this. However, the facility to postpone it for 2 years is also available, those who do so get pension after the age of 60 years with 4% bonus. There are many types of schemes. In which widow pension, orphan pension, reduced pension are included.
Here is the calculation
Under this scheme, both the company and the employee make an equal contribution of 12% of the employee’s salary to the EPF fund. In which the employee’s share goes to EPF and 8.33% of the company’s share goes to EPS and 3.67% to EPF every month. The formula for calculating pension is “Employee’s monthly salary = Pensionable salary x Pension total service/70”. If a person’s salary is Rs.15000.
So he will get a pension of Rs.1250 on the basis of 1500 x 8.33/100. On the other hand, if the employee works for 20 years, then according to this he can get a pension of Rs 4286. On the other hand, if a person earns 30 thousand in a month, then he can get Rs 12,857 as salary.
