NPS vs UPS Case Study 1: New employees

A new employee, joined central government service on 31.03.2025 (UPS starts from 01.04.2025)

Assumption as on 15th April 2025

1. An employee with current Basic Pay Rs 10,000/- 

2. DA: 53%

3. Annual increment in January: 3%

4. Increase in DA/year in January: 7%

5. Pay commission in 2026 and every 10 years.

6. Special increase in DA due to pay commission:  10%. 

7. Length of service: 35 years (Retirement at age 60) 

8. Withdrawal at age 60: 60% of Individual corpus (Employee + Employer's contribution combined)

9. Annuity plan's return: 7%.

10. Amount accumulated in NPS before 01.04.2025: 0

11. No change in basic pay apart from annual increment. No promotion considered.  

Let us calculate between NPS and UPS, which is beneficial for him/her

NPS

Employee Contribution (%): 10% 

Employer Contribution (%): 14%

Individual corpus* (2060, Age 60):  Rs 2,57,91,507/- (Rs 2.58 Cr)

Withdrawal 60% at retirement of *: ₹1,54,74,904/- (Rs 1.6 Cr)

Pension Corpus of *: ₹1,03,16,603/- (Rs 1.03 Cr)

Pension per Month: ₹60,180/- (Rs 60k) (Fixed, Not linked to DA/DR)

UPS

Employee Contribution (%): 10% 

Employer Contribution (%): 10%

Individual corpus**:  ₹2,14,92,922/- (Rs 2.15 Cr)

Basic Pay at retirement (2060, Age 60): ₹2,78,978/-

DR at retirement (2060, Age 60): 28%

Lump Sum Amount (Service Benefit): ₹24,99,643/- (Rs 25L) 

Withdrawal 60% at retirement of **: ₹1,28,95,753/- (Rs 1.3 Cr)

Pension per Month: ₹55,796/- + DR (with 28% DR, Rs 71,418/-)

 

Withdrawal 0% at retirement of **: ₹0/- (Rs 0)

Pension per Month: ₹1,39,489/- + DR (with 28% DR, Rs 1,78,546/-)

 

Pension amount to be received: NPS after 60% withdrawal vs UPS  after 60% withdrawal at retirement at age 60 (2060)

NPS: Rs 60k (Fixed)

UPS: Rs 71k/- (₹56k/- + DR), assuming DR 28%

 Total amount to be received: NPS after 60% withdrawal vs UPS  after 60% withdrawal at retirement at age 60 (2060)

 NPS: Rs 1.6 Cr

UPS: Rs 25L + Rs 1.30 Cr = 1.55 Cr

 

Pension amount to be received: NPS after 60% withdrawal vs UPS  after 0% withdrawal at retirement at age 60 (2060)

NPS: Rs 60k (Fixed)

UPS: Rs 1.78L (₹1.39L + DR), assuming DR 28%

 

Total amount to be received: NPS after 60% withdrawal vs UPS  after 0% withdrawal at retirement at age 60 (2060)

NPS: Rs 1.6 Cr

UPS: Rs 25L + Rs 0 = Rs 25L

Table: Pension and Total Amount to be Received at Retirement (2060)

Category	Pension Amount (₹/month)	Total Amount (₹)
NPS (60% Withdrawal)	60,000 (fixed)	1.6 Cr
UPS (60% Withdrawal)	71,000 (56,000 + DR), DR, 28% in 2060	1.55 Cr
UPS (0% Withdrawal)	178,000 (139,000 + DR), DR, 28% in 2060	25 L

Conclusion

As per eFinance365.com team, using Unified pension scheme, UPS calculator and  National pension scheme, NPS calculator

UPS with 60% withdrawal appears beneficial than NPS with 60% withdrawal. 

 

Calculation screenshots

NPS Screenshot 1

NPS Screenshot 2

 

NPS Screenshot 3

UPS Screenshot 1

UPS Screenshot 2

UPS Screenshot 3  

UPS Screenshot 4 

UPS Screenshot 5 

Conclusion

As per eFinance365.com team, using Unified pension scheme, UPS calculator and  National pension scheme, NPS calculator

UPS with 60% withdrawal appears beneficial than NPS with 60% withdrawal. 

 

Reference

https://www.efinance365.com/2025/04/ups-calculator-only-calculator-you-need.html 

https://www.efinance365.com/ 

Gazette Notification 19.01.2025 and 19.03.2025