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Retired Private Employee, 60, with 9.5 Years of Service: Still Eligible for Monthly Pension?

Milind

Milind Vadjikar  | Answer  |Ask -

Insurance, Stocks, MF, PF Expert - Answered on Feb 04, 2025

Milind Vadjikar is an independent MF distributor registered with Association of Mutual Funds in India (AMFI) and a retirement financial planning advisor registered with Pension Fund Regulatory and Development Authority (PFRDA).
He has a mechanical engineering degree from Government Engineering College, Sambhajinagar, and an MBA in international business from the Symbiosis Institute of Business Management, Pune.
With over 16 years of experience in stock investments, and over six year experience in investment guidance and support, he believes that balanced asset allocation and goal-focused disciplined investing is the key to achieving investor goals.... more
Asked by Anonymous - Jan 24, 2025Hindi
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Sir, I work in a private organization in hyderabad and i am pf member also. I retired on attaining the superannuation age of 58 years in the year 2023. Im 60 years now but still working there. However, I'm still short of 4 months to complete my 10 years of mandatory service to be eligible for monthly pension. Given the above scenario, I would like to know if I'm still eligible for monthly pension once I complete 10 years of sevice after 4 months, if not will I have to withdraw my full pension now or I can withdraw any time in future, say after one or two years. Further, my sevice duration in my passbook is showing as 2007 years, 6 months and 0 days. Will this error cause any problem when applying for pension or withdrwaing pf amount. I shall be obliged if you would kindly reply my above query. With regards Ahmed M

Ans: Hello;

You are required to complete 10 years before 58.

But you may still withdraw your EPS contribution and now both employer employee contribution should go to epf only.

Please amend service record in case of any anomaly through your current employer.

Best wishes;
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Milind

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Insurance, Stocks, MF, PF Expert - Answered on Mar 20, 2025

Asked by Anonymous - Mar 08, 2025Hindi
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Dear PF Expert, My question is regarding the impact of partial withdrawal money from my EPF corpus. I quit my job in Feb 2023 (2 years ago) to work as a freelancer, after more than 18 years of service in the industry. My understanding: a. After 3 years of no contribution to the PF account, it becomes dormant and doesn't accrue any interest. b. To receive the EPS pension, one needs to turn 58 years. c. Based on the formula (Pensionable Salary) * (Pensionable Service) / 70, the max. monthly pension is capped to Rs. 7500 as on Mar, 2025. To meet certain financial needs, I would like to make a partial withdrawal from my PF corpus. My questions: 1) How will this impact my EPS pension after I turn 58 years? Since the Pensionable salary is dependent only on the average salary in the last 5 years of service and not on the outstanding corpus, the fact that I have withdrawn before retirement age of 58 shouldn't matter. Is my understanding correct? Also, since my average Basic for the last 5 years of service was more than Rs. 15000 and I had 18 years of service, I should ideally get a monthly pension of 15000 * 18/70 = Rs.3857 (approx.) Please confirm if my understanding and calculation is correct (Of course, this is assuming that the formula will hold good when I eventually turn 58 to receive the pension) 2)If this is the only partial withdrawal that I would ever make, can I assume that the corpus that would be available for lumpsum withdrawal after I turn 58 would be: [Current Corpus - Partial Withdrawn Amount] * (1.0825) * 1 (EPF interest of 8.25 % and I have only one more year of interest accrual out of 3)? Please respond so that I can make an informed decision about my partial withdrawal
Ans: Hello;

Answers to your queries are as given below:

1. EPF partial withdrawal will have No impact on EPS.
The estimated monthly EPS pension seems okay.

2. Your assumption about net EPF corpus available to you after 58 is correct, in principal.

Best wishes;

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