Employees’ Provident Fund, or EPF, is one of the fundamental social safety nets that is available to all employees in the organsied sector in India. It creates through contributions from the employees and a matching amount by the employers, a huge corpus of money that is paid to the employee at the time of retirement apart from a monthly pension.
An online EPF calculator will tell you why, all other factors remaining equal, you should opt for an employer who gives you provident fund, or EPF. The amount that EPF can build for you silently as you focus on your career is unmatched by any other instrument. The most remarkable aspect is that EPF offers income tax relief as well as complete safety of capital, interest as well as the matured amount.
PF maturity calculator: What it can tell you
One usually graduates at the age of 21. Let’s assume a young man/woman gets a job at the age of 22 after looking for a job for about 1 year. Let’s also assume that the monthly basic salary that he/she is paid from the first month is Rs 10,000. According to rules, the contribution of the employee to EPF account is 12% of his/her basic (+DA) and 3.67% of the basic by the employer.
The online EPF calculator will tell you that if the person retires at the age of 58, the amount that the account will have ready for him/her is a neat pool of Rs 1,45,26,062, or more than Rs 1.45 crore. Two other assumptions are implicit in this calculation. One, the employee gets an annual salary increment of 10% and two, the rate of interest that the EPFO pays every year is 8% (which is in fact lower than the 8.25% paid in FY24).
EPF passbook: how to know balance in account
Every employee who is a contributor to EPF has free and online access to his/her EPF passbook. He/she can check the outstanding balance at any given point of time by logging through the UMANG app by tying in UAN (Universal Account Number), which is a 12-digit number given to every EPF contributor. The UMANG app can be downloaded in your phone.
To know the amount in EPF account, one can also send an SMS to 7738299899 from the registered mobile number. One can also know it through a ‘missed call’ to 9966044425 from the mobile number registered with the EPFO.
Though businesses in India are increasingly resorting to employment that puts the entire cost to company in the hands of the employee, anyone looking for a job must be aware of the huge gains from EPF, or Employees’ Provident Fund. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
