Atal Pension Yojana Calculator

Launched on 9th May 2015, the Atal Pension Yojana (APY) seeks to establish a universal social security system for all Indian citizens. The Pension Fund Regulatory and Development Authority (PFRDA) regulates this scheme. It mainly focuses on the welfare of the economically disadvantaged, underprivileged individuals, and workers employed within an unorganised sector.

About Atal Pension Yojana

Atal Pension Yojana is a pension scheme which is accessible to all bank account holders aged between 18 and 40 years. The contributions are determined based on the selected pension amount, ensuring flexibility to cater to various income levels. When a subscriber of APY turns 60, they are guaranteed a minimum monthly pension ranging from ₹1000, ₹2000, ₹3000, ₹4000 or ₹5000. Moreover, in case of the account holder’s death, his/her spouse will be eligible to receive this pension.

The Atal Pension Yojana calculator can help you estimate your potential retirement savings. Keep reading!

What is the Atal Pension Yojana Calculator?

The Atal Pension Yojana calculator helps you calculate the actual interest you can receive by investing in this scheme. You can use it to determine the amount of pension you wish to receive, the monthly contribution amount and also the age at which you need to start investing.

This calculator also ensures that your calculations are free of errors. Thus, it is an important tool when it comes to planning your retirement fund.

How Does the APY Calculator Work?

The APY calculator computes the pension amount on the basis of interest and compound frequency. For instance:

If 1% interest rate is compounded annually, APY is 1%
When 0.75% interest rate is compounded quarterly, APY is 0.702%.
For a 0.5% interest rate that is compounded daily, the APY is 0.501%.

Among all the above options, the first one provides the highest APY. This implies that the greater the value of APY, the better the offer you can get.

Formula to Calculate

Here is a mathematical formula which the APY calculator uses:

APY = (1 + r / n) n – 1

Here,

r - Interest rate

n - Number of times the interest is compounded in a year

Advantages of Using APY Calculator

Mentioned below are the advantages of using the APY calculator:

An APY Scheme calculator has a user-friendly interface. You need to enter your age and desired monthly pension amount to know your monthly contribution.
The calculator provides fast and accurate results within a few seconds of entering your data.
You can modify the data in order to find out the required monthly contribution for your desired monthly pension amount.
The Atal Pension Yojana calculator not only helps you plan your retirement but also your current finances. You get to know how much to set aside from your current income and what amount you can expect from this scheme post-retirement.

How to Use Atal Pension Yojana Calculator?

An Atal Pension Yojana calculator needs the following parameters:

Age:Present age of the investor.

Expected Pension Amount:The investor must choose the pension amount he wishes to earn after retirement. This amount ranges from ₹1000 to ₹5000.

These two parameters showcase the amount of contribution an individual has to make and the interest he or she will earn after retirement.

Following are the steps you need to follow to use the APY calculator:

Step 1:Select your joining age.

Step 2:Enter your desired monthly pension amount.

After providing the above information, the calculator will instantly compute the result of the following:

Your monthly, quarterly or annual investment.
Duration of your investment.
Total investment amount.

Let us take a few examples to understand this calculation method.

Example 1:

Suppose there is an investor called Raj, who is 20 years old and expects a pension amount of ₹1000. Upon entering this data, the APY Calculator will give the following results:

Monthly investment amount: ₹50
Duration of Investment: 40 years
Total contribution: ₹24,000

Hence, Raj has to give ₹50 every month for 40 years. At the end of this period, his total contribution will be ₹24,000. Additionally, after Raj turns 60 years old, he will receive ₹1000 every month as a pension.

Example 2:

Let’s assume Mohan wants to receive a pension amount of ₹4000 and is 25 years old. After entering the data, the calculator will display the following results:

Monthly investment amount: ₹301
Duration of Investment: 35 years
Total contribution: ₹1,26,420

This implies Mohan has to provide ₹301 every month for 35 years to receive ₹1,26,420 as his total contribution. Moreover, when he turns 60 years old, he will get ₹4000 every month as a pension.

Thus, the Atal Pension Yojana calculator is an effective tool when it comes to retirement planning. It not only gives you an idea in advance of how much you need to save but also prevents the mistakes that can arise due to manual calculation. Additionally, it is not subject to any usage restrictions, and you can access it as many times as you need.

Atal Pension Yojana Calculator