APY is a Central government-run scheme which guarantees income security with a fixed monthly payout of up to Rs 5000 after retirement.
Atal Pension Yojana calculation: By saving just Rs 7 per day from age 18 and investing this amount in an Atal Pension Yojana (APY) account on a monthly basis, you can ensure a pension of Rs 5000/month after retirement.
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If you save Rs 7 per day, you will have Rs 210 at the end of the month. According to the indicative APY contribution chart by PFRDA, you need to contribute just Rs 210 per month from age 18 for a monthly pension of Rs 5000 upon retirement at age 60.
Likewise, if you open an APY account at age 25, you will be required to contribute Rs 376/month for a monthly pension of Rs 5000 under this scheme. The monthly contribution required to get Rs 5000/month after retirement under this scheme increases with age. From age 30, the monthly contribution required for Rs 5000 pension is Rs 577 and from age 35, it is Rs 902/month. (see chart below).
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The chart shows that for a monthly pension of Rs 1000 after retirement, you need to contribute only Rs 42/month from age 18 and just Rs 116 from age 30.
What is APY?
APY is a Central government-run scheme which guarantees income security with a fixed monthly payout of up to Rs 5000 after retirement. The scheme was introduced in 2015-16 and aimed at encouraging workers in the unorganized sector to voluntarily save money for their retirement.
APY is administered by the Pension Fund Regulatory and Development Authority (PFRDA) through NPS architecture. The scheme guaranteed a minimum monthly pension to subscribers. The monthly pension ranges from Rs 1,000 to Rs 5,000 per month. The final pension amount varies, depending on the amount and tenure of investment done by the subscriber.
Any Indian citizen aged 18 to 40 years can subscribe to this scheme.
