Pension from EPFO is linked with pension eligibility and the amount of pension. It is also dependent on many factors. Pension can be earned only after a specific duration of working under the terms and conditions laid down. The pension scheme is very important for the employees of the private sector to understand clearly because of all these benefits to the employees, who have contributed regularly and for a long duration.
When did the pension scheme begin?
The Employees’ Pension Scheme was introduced in 1995. This is a scheme that establishes the future for employees. The Employees’ Provident Fund Organization operates it, and it states that employees will be given the benefit of a pension scheme by which they will be covered in terms of old-age income security. The benefit of this scheme is for the employee in addition to the protection of family members or nominees. In order to enroll yourself in the scheme, you need to be aware of its eligibility criteria when you can claim its benefits.
It’s Important to Get a Pension
The EPS pension plan covers those employees who have worked for 10 years and have paid their contributions timely to the Employees Provident Fund Organization. Under the scheme, if an employee is more than 50 years of age and has contributed for the requisite period, then he is entitled to get a pension without seat. The scheme, even if it is very small, guarantees the future of the employees so they stay secure financially when out of work.
How to calculate pension
This process is quite simple for the members of EPFO whom it concerns the calculation of pension. The amount of pension is primarily based on two things. First, it is seen how many days you have contributed to the pension scheme. The second thing considered is your average salary 60 months before your retirement. Based on both these factors, your pension amount is calculated, which informs you of what pension you will get after retirement.
You may check it on the website
- Firstly go to the official website of EPFI Epfindia.gov.in and click on the online service section, where many options will be visible.
- Then select the option-EDLI & Pension Calculator, which has been designed solely for the purpose of pension calculation.
- Understand the use of the calculator before you opt for it so that you will be able to fill the information correctly.
- Identify the pension amount by entering all the required data in the EDLI and Pension Calculator since it will guide you well in future directions for your financial planning.
This is how pension is decided according to age
An EPF member has to necessarily contribute to EPS for a minimum period of 10 years in order to get a pension. If a person accomplishes 20 years of contribution or more than that will also receive an extra bonus of 2 years. But an employee ages between 50 and 58 will get less amount of pension because at this age retirement will be less than 4 percent. On the contrary, retirement after 58 years will entitle him to receive an increased rate of 4 percent every year in the pension till he attains the age of 60, thus making it possible to grant him a larger pension.
