COMMUTATION
Calculated for the person who retired after completion of 20 years of service:
Leave encashment counted 300 days.
DA counted 50%
X pay or Tech Pay counted 6200
MSP counted 5400
If commuted 50% of pension:
1 Basic Pension 30870
2 Commuted Pension 15435
3 Residual Pension*(You Will Get This Amount Monthly) 15435
4 DA On Basic Pension 15435
5 Total Pension In Hand(Payable By Your Bank) 30870*
6 Capitalised Value Of Pension(You Will Get This In Lumpsum) 1680871
7 Retirement Gratuity 1154250
8 Leave Encashment (Will Be Paid By NPO) 744000
9 Approx Amount In Hand (Excluding NGIF) 3579121
*This is the pension you get monthly when you commute 50% of your pension.
If commuted 0% of pension:
1 Basic Pension 30870
2 Commuted Pension 0
3 Residual Pension*(You Will Get This Amount Monthly) 30870
4 DA On Basic Pension 15435
5 Total Pension In Hand(Payable By Your Bank) 46305#
6 Capitalised Value Of Pension(You Will Get This In Lumpsum) 0
7 Retirement Gratuity 1154250
8 Leave Encashment (Will Be Paid By NPO) 744000
9 Approx Amount In Hand (Excluding NGIF) 1898250
#This is the pension you get monthly when you commute 0% of your pension.
Full pension – 50% commuted pension = 46305-30870
= 15435
Commuted pension will be restored after 15 years 15 x 12 x 15435 = 2778300
Total repayment of commuted pension in 15 years-Capitalised Value of Pension=
= 2778300-1680871=1097429 (your pay extra to Govt)
(Rate of Interest is approx. 7.4%)
calculate the amount you will get if you invest ₹15435 every month for 15 years in a risk-free
scheme offered by a public sector bank in India, we'll consider the most common risk-free
investment options such as Fixed Deposits (FDs) or Recurring Deposits (RDs). As of today,
interest rates for these schemes are typically around 6-7% per annum.
Let's assume a conservative annual interest rate of 6.5% for our calculations. We will use the
formula for the future value of an ordinary annuity (since monthly investments are like an
annuity):
A=P x (1+r/n)nt−1
r/n
Where:
A = future value of the investment
P = monthly investment amount (₹15435)
r = annual interest rate (0.065)
n = number of times interest is compounded per year (12 for monthly)
t = number of years the money is invested (15)
Let's calculate the future value using this formula.
If you invest ₹15435 every month for 15 years at an annual interest rate of 6.5%,
compounded monthly, you will get approximately ₹48, 52,130.91 at the end of the investment
period
Sridhar
