Eps 95 Pension Scheme

Planning for retirement is one of the most important financial steps in life. The Employees’ Pension Scheme (EPS 95) is designed to ensure a stable, lifelong income for employees after they retire. Introduced by the Employees’ Provident Fund Organisation (EPFO), this government-backed pension scheme offers financial security and peace of mind during post-retirement years. Understanding how EPS 95 works, how to calculate your pension, and how to apply for it can help you prepare for a comfortable, worry-free retirement.

What is the EPS 95 pension scheme?

The Employees’ Pension Scheme, 1995 (EPS 95) is a social security initiative launched by the Government of India to provide pension benefits to employees working in the organised sector. It is managed by the EPFO (Employees’ Provident Fund Organisation) and applies to employees earning a basic salary plus dearness allowance of up to Rs. 15,000 per month.

Under this scheme, 8.33% of your employer’s contribution to the EPF is directed to the EPS account, while the rest goes toward the EPF corpus. On retirement, the scheme provides a monthly pension to eligible members or their dependents in case of death.

EPS 95 serves as a financial safety net, ensuring employees have a steady source of income after leaving active service.

If you’re planning your retirement, combining EPS benefits with a life insurance retirement plan can help you build stronger financial security. Explore plans and get quote!

Your monthly pension under EPS 95 is calculated using a simple formula set by EPFO. Here’s how it works:

Pension = (Pensionable Salary × Pensionable Service) / 70

Let’s break this down:

• Pensionable salary:

This is the average salary (basic + DA) earned during the last 60 months of service before retirement. The maximum salary considered for calculation is Rs. 15,000 per month.

• Pensionable service: 

This refers to the total number of years you have worked in an organisation that contributes to EPS. The minimum service required is 10 years, and service of more than six months is rounded off to the next year.

• Example:

If your average pensionable salary is Rs. 15,000 and your service period is 30 years,
 

EPS Pension = (15,000 × 30) / 70 = Rs. 6,428 per month approximately.

Additional points to note:

• The minimum monthly pension under EPS 95 is ₹1,000.
• Higher service years and contributions can increase your pension amount.
• You can check your estimated EPS pension on the EPFO portal or through the UMANG app.

While EPS ensures a fixed pension, you can enhance your post-retirement income by investing in life insurance retirement plans for higher and tax-efficient returns.

To receive pension benefits under the EPS 95 scheme, you must meet the following criteria:

• Membership duration: 

You must have completed a minimum of 10 years of contributory service under the EPF and EPS.

• Age limit: 

The minimum age for pension eligibility is 58 years. You can also opt for early pension from age 50 onwards, but the amount will be reduced by 4% for each year below 58.

• Retirement or cessation of service: 

Pension benefits start after you retire, resign, or are permanently disabled during service.

• Withdrawal benefit: 

If you leave before completing 10 years of service, you can withdraw your EPS balance instead of a monthly pension.

• Family pension: 

In case of the member’s death, the spouse and eligible children are entitled to receive a family pension.

• Deferred pension option: 

You may choose to defer your pension up to 60 years for a higher monthly payout.

Even with EPS coverage, your retirement income might not be enough for inflation and lifestyle goals. Explore guaranteed life insurance plans for pension to supplement your EPS benefits.

While EPS 95 is a reliable pension plan, many employees miss out on full benefits due to small but critical mistakes. Avoid these common errors:

• Not updating EPF records: 

Ensure your name, date of birth, and employment details are correctly recorded in EPFO records. Discrepancies can delay your pension processing.

• Frequent job changes without EPF transfer: 

When switching jobs, always transfer your EPF account to retain your EPS continuity. Breaking the link can affect your total pensionable service.

• Ignoring contribution details: 

Regularly check your EPFO passbook to ensure both employer and employee contributions are being correctly credited.

• Delaying pension application: 

Apply for pension on time (before or upon retirement) to avoid delays in payouts.

• Not nominating dependents: 

Always register your nominee to ensure your family receives benefits in your absence.

• Assuming EPS alone is sufficient: 

EPS provides a modest income; supplementing it with private pension or life insurance annuity plans ensures a more comfortable retirement.

Secure your golden years — consider adding a life insurance pension plan alongside your EPS 95 to enjoy steady and enhanced retirement income. Explore plans and get quote!

How to apply for EPS 95 pension scheme?

Applying for your EPS 95 pension is a simple, step-by-step process. Here’s how you can do it:

• Step 1: 

Download and fill Form 10D – This is the official pension application form available on the EPFO website or through your employer.

• Step 2: 

Submit through your employer – If you are still employed, submit the form to your employer for attestation. Retired or separated employees can submit directly to the EPFO office.

• Step 3: 

Attach required documents – Include your Aadhaar, PAN, bank details, and EPF passbook along with passport-size photographs.

• Step 4: 

Verification by EPFO – EPFO verifies your details and service records.

• Step 5: 

Pension approval – Once approved, you’ll receive your Pension Payment Order (PPO) number.

• Step 6: 

Start receiving pension – Your monthly pension amount will be credited to your registered bank account.

You can also apply online via the EPFO Member Portal or UMANG app for quicker processing.

Keep your EPFO details updated and explore life insurance pension solutions that provide additional guaranteed income to complement your EPS benefits.

Conclusion

The EPS 95 Pension Scheme is a dependable retirement safety net for salaried employees, ensuring regular income after service. However, EPS alone might not be sufficient to meet your future lifestyle goals. By pairing it with a life insurance retirement plan, you can enjoy both guaranteed income and peace of mind.

Start your retirement planning today — explore life insurance pension plans that secure your future and keep your post-retirement dreams alive. Get quote!