EPS pension still as attractive? 9.49% of salary to go from employer's contribution into EPS

 

Whether the EPS pension scheme remains attractive or not depends on individual circumstances and personal preferences. The EPS is a pension scheme that provides benefits to employees after they retire. Under the scheme, both the employer and the employee contribute a percentage of the employee's salary towards the pension fund.

As per the recent clarification by the Ministry of Labour and Employment, the pension amount for employees who have contributed to the EPS on higher wages will be calculated based on their actual salary rather than the capped amount of Rs. 15,000 per month. This will result in higher pension amounts for employees who have contributed to the scheme on higher wages.

However, it is important to note that 9.49% of the employee's salary goes towards the EPS contribution from the employer, which is a significant amount. Some employees may prefer to invest this money in other investment options that offer potentially higher returns, such as mutual funds or the National Pension Scheme (NPS).

Therefore, it is important for employees to consider their individual financial goals and circumstances before deciding whether the EPS pension scheme is attractive or not for them. It is also advisable to consult a financial advisor to make an informed decision about retirement planning.