NPS vs Mutual Funds

A 25-year-old investing ₹10,000/month in NPS with 5% annual step-up and 13.55% average returns for 35 years will accumulate a corpus of ₹11.24 Cr, with ₹6.74 Cr as a tax-free lumpsum.

A 25-year-old investing ₹7,000/month (after tax) in Aggressive Equity Mutual Funds with 5% annual step-up and 12.36% average returns for 35 years will accumulate a corpus of ₹6.51 Cr (approximately ₹5.8 Cr after tax).

If a 25-year-old invests ₹10,000/month in NPS with 5% annual step-up and 12% average returns for 35 years, their corpus will be ₹8.1 Cr, with ₹4.86 Cr as a tax-free lumpsum.

If a 25-year-old invests ₹7,000/month (after tax) in Mutual Funds with 5% annual step-up and 12% average returns for 35 years, their corpus will be ₹6.03 Cr before tax (approximately ₹5.4 Cr after tax).

Based on a 35-year investment period with 5% annual step-up and 13.55% annual returns, the NPS corpus is projected to be ₹11.24 Cr, of which ₹6.74 Cr will be a tax-free lump sum.

Based on a 35-year investment period with 5% annual step-up and 12.36% annual returns, the Mutual Fund corpus is projected to be ₹6.51 Cr before tax, and approximately ₹5.8 Cr after tax.

If both NPS and Mutual Funds achieve 12% annual returns over a 35-year period with 5% annual step-up, the NPS corpus is projected to be ₹8.1 Cr, with ₹4.86 Cr being tax-free.

If both NPS and Mutual Funds achieve 12% annual returns over a 35-year period with 5% annual step-up, the Mutual Fund corpus is projected to be ₹6.03 Cr before tax, and approximately ₹5.4 Cr after tax.