September 26, 2012

EPF - Pension Scheme - A Hidden Gem

Not sure how much Rs 3,250/month would mean to you when you cross 58 yrs.. But here you go with the details on EPF – Pension Scheme
Do you know that there are two elements in EPF- one is called EPF and other is EPS. The EPF is actually for your provided fund and EPS is for your pension. The 12% contribution from your side goes to EPF, but the 12% contribution which your employer makes, out of that 8.33% actually goes in EPS (subject to maximum of Rs 541) and the rest goes into EPF. So understand it this way, a part of your employer contribution actually makes up your pension corpus. But there are some caveats to this.
One is liable for pension only if one has completed the age of 58.
One is liable for pension only if he has completed 10 yrs of service (in case of more than one companies, the EPF should have been transferred, not withdrawn)
The maximum Pension per month is subject to maximum of Rs 3,250 per month.
Lifelong pension is available to the member and upon his death members of the family are entitled for the pension.
More details can be found here..
 
 

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