My Wife's pf amount is still not with drawn. She got retired on 07-06-24. So after 3 years can we opt for EPS pension instead of with drawing the money. What will be the pension amount likely on the PF amount of Rs 12 Lakhs

Ans: Let’s go through your concern in a very structured, detailed, and practical way. You’re asking about EPS pension eligibility for your wife, who retired on 07-06-2024 and has not withdrawn her PF yet. You also want to know whether she can opt for EPS pension after 3 years and how much pension she could expect on a PF amount of Rs 12 lakhs.

Here’s a complete, 360-degree perspective for you:

Understanding the Difference Between EPF and EPS

EPF is your provident fund savings account

It builds a retirement corpus, grows with interest

EPS is the pension scheme under EPF

It gives monthly pension after retirement

Contribution towards EPS is separate from EPF

Out of the employer’s 12% contribution, 8.33% goes into EPS (subject to salary cap)

Eligibility for EPS Pension

To get EPS pension, minimum 10 years of eligible service is required

Retirement age for full pension is 58 years

One can opt for reduced pension after age 50

If PF is not withdrawn, service continues to be counted

So, yes, she can apply for EPS pension even after 3 years

She just needs to keep the EPF account untouched

This is a valid approach used by many retirees

What Happens If You Withdraw Now

If you withdraw EPS amount now, you lose lifelong monthly pension

You only receive the lump sum EPS portion

Once withdrawn, pension option is no longer available

This decision is final and cannot be reversed later

So it’s wise to pause and assess pension eligibility properly

How EPS Pension Is Calculated

Pension depends on two factors:

Pensionable salary: average of last 60 months' basic + DA

Pensionable service: total years of contribution into EPS

The pension is calculated as:
(Pensionable salary x Pensionable service years) ÷ 70

For example, with Rs 15,000 pensionable salary and 20 years of service:
(15,000 x 20) ÷ 70 = Rs 4,285 approx per month

If pension is taken before 58, amount is reduced by 4% per year

So, if taken at 55, pension will be reduced by 12%

Is Rs 12 Lakhs in PF Relevant for EPS Pension?

The PF corpus (Rs 12 lakhs) is not used directly in EPS pension calculation

That is your wife’s savings in the provident fund

EPS contribution is small and fixed — not linked to total PF balance

Only her years of EPS contribution and pensionable salary matter

What to Do Now – Step-by-Step

Confirm Service Period & EPS Contribution

Login to her UAN portal

Download PF Passbook

Check how many years she was under EPS coverage

Check if she crossed 10 years of service (minimum for pension)

Decide on Withdrawal vs Pension

If she needs a large amount now, withdrawing may look attractive

But long-term, monthly pension gives stable cash flow

If no urgent need, it is better to wait

Timing Is Crucial

Waiting till 58 gives full pension

If pension is started at 55, there is a permanent 12% reduction

For every year after 58, pension increases by 4%

Plan as per income needs and inflation

Apply for EPS Pension

Use Form 10D

Submit online on EPFO portal or offline at EPF office

Pension will be credited monthly to her bank account

A Look at Practical Scenarios

Let’s assume the pensionable salary is capped at Rs 15,000
If she has contributed to EPS for 20 years:
Pension = (15,000 x 20) ÷ 70 = Rs 4,285/month

If she opts at age 55 (3 years early):
Pension gets reduced by 12% → Approx Rs 3,770/month

If she waits till 58:
She can receive full pension without reduction

If she waits till 59 or 60:
She gets 4% increase for each year → Higher monthly pension

These numbers are approximate, not final
Exact pension is decided by EPFO after processing her Form 10D

How to Plan With the EPF Balance (Rs 12 Lakhs)

Rs 12 lakhs is a good amount of retirement corpus

This can be withdrawn or kept to earn EPF interest till age 58

After withdrawal, reinvest this in actively managed mutual funds

Do not park it in low-return savings accounts

You can create SWP (Systematic Withdrawal Plan) from mutual funds

This gives monthly cash flow just like pension, but better returns

Why You Should Avoid Index Funds

Index funds just copy the index, do not beat it

During volatile times, they fall fully with the market

No expert fund manager to protect your capital

They do not adjust sector allocations

You may get stuck in bad sectors like PSU or small caps

Active funds are managed with strategy and analysis

They offer downside protection and better long-term growth

For retired life, protection from loss is more important than hype

Why You Should Avoid Direct Mutual Funds

Direct funds offer no guidance or handholding

You miss rebalancing and timely reviews

You also carry behavioural risk of panic selling during crashes

Investing through a MFD backed by a Certified Financial Planner is safer

You get expert planning, fund selection, tax guidance and review

Long-term performance improves through behavioural discipline and strategy

Emotional Angle – Planning Together

Make these decisions jointly with your wife

Discuss monthly cash flow needs honestly

Decide how much you need from pension and how much from investment

Involve your children if needed

Retirement is a phase where teamwork matters more

Final Insights

Yes, your wife can opt for EPS pension even after 3 years of retirement

She must not withdraw PF now if she wants to be eligible

Confirm service years and pensionable salary through UAN portal

EPS pension may be approx Rs 3,770 to Rs 4,285/month based on timing

Withdraw PF only when needed, then invest smartly in mutual funds

Avoid index and direct funds – go with expert-guided active funds

This creates peace of mind and better retirement safety

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment