Let\u2019s use an EPF calculator to see how a 30-year-old can accumulate over \u20b94 crore as a retirement corpus. The calculation requires several assumptions about salary, contributions, interest, and retirement. We used Bajaj Finserv\u2019s EPF calculator during the estimation.<\/p>\n
Let\u2019s assume that the person starts with a monthly basic salary and dearness allowance (DA<\/a>) totalling \u20b980,000. The employee starts contributing 12% of this amount towards the Employees\u2019 Provident Fund (EPF<\/a>). The employer\u2019s contribution is calculated at 3.67%.<\/p>\n Also Read | \u20b925,000 basic pay can build \u20b91.12 crore EPF corpus in 30 years \u2013 Here’s how<\/a><\/p>\n The calculator assumes a 6% salary increase every year. It uses an annual interest rate of 8.25%.<\/p>\n During the first year, the employee contributes \u20b91,15,200. The employer adds \u20b935,232, taking the total contribution to \u20b91,50,432. After interest, the first-year closing balance becomes \u20b91,62,843.<\/p>\n By Year 5, the annual employee contribution reaches \u20b91,45,437. The closing balance reaches \u20b910,72,501.<\/p>\n The balance continues rising alongside the assumed annual salary increase. At Year 10, the closing amount reaches \u20b930,29,421. It increases to \u20b964,23,631 by Year 15.<\/p>\n During Year 18, the closing balance stands at \u20b994,91,845. It crosses \u20b91 crore during Year 19, reaching \u20b91,07,39,724.<\/p>\n The yearly employee contribution then equals \u20b93,28,815. The employer contributes \u20b91,00,563 during the same year. Their combined contribution for that year is \u20b94,29,378.<\/p>\n By Year 20, the closing balance reaches \u20b91,21,18,442. It rises to \u20b91,53,19,393 during Year 22. The amount becomes \u20b91,92,08,588 by Year 24.<\/p>\n Also Read | Should you invest in NPS if you already have EPF? Experts explain<\/a><\/p>\n The balance crosses \u20b92 crore during Year 25. It reaches \u20b92,14,52,630 after that year\u2019s contribution and interest.<\/p>\n By Year 28, the closing balance becomes \u20b92,96,18,431. It grows to \u20b93,28,94,346 in Year 29. The Year 30 balance reaches \u20b93,64,90,468.<\/p>\n The final accumulated maturity amount is \u20b94,04,36,209. Total investment over the period amounts to \u20b91,27,56,775. Total interest contributes another \u20b92,76,79,434. The EPF calculator<\/a> shows estimated returns rising much faster during later years.<\/p>\n