UPS Pension Calculations: What will be your monthly pension if you retire with Rs 1,02,000 last-drawn basic pay and 27 years of service?

Unified Pension Scheme (UPS) for pension

The pension scheme was launched after a lot of central government employees demanded an assured pension. They were following NPS, which doesn't have a provision of an assured monthly pension. UPS, which came into effect from April 1, 2025, also offers a family pension and a lump sum amount at the retirement of an employee. 

Who may opt for UPS?

The scheme is open only to central government employees. Private sector employees or the self-employed can't open a UPS account. But existing NPS account holder central government employees can switch to UPS.

 

Is UPS open to pensioners?

Central government employees who are getting their pension under NPS can also switch to UPS. However, only one switch is possible. They can't return to NPS. 

What is concept of assured income in UPS?

In NPS, pension depends on the individual and their employer's contribution to the employee's NPS account. There is no concept of an assured pension. However, UPS offers an assured income, where an employee, if they complete 10 years of service, is assured of at least a Rs 10,000 pension. As far as the highest pension range is concerned, they may get up to 50 per cent of their 12-month average basic pay and DA immediately prior to superannuation. 

UPS contribution of central government employee

In UPS, a central government employee can invest 10 per cent of their basic pay and DA. The government will contribute 18.5 per cent of the employee's basic pay and DA. So, the total UPS contribution will be 28.5 per cent.

Where will UPS' 28.5% contribution be invested?

Of it, 18.5 per cent will be invested in mutual funds and fixed interest assets as happens in NPS, the rest of the 10 per cent amount will be invested in a pool of assured income. So, the contribution will ensure growth and assured income. 

Can one get higher UPS pension than assured amount?

Depending on how their investments in mutual funds and fixed assets perform, they can also get a pension amount higher than the assured pension. If the investment performance is poor, pension holders will still get the assured pension amount.

Family pension in UPS

In the UPS, if a pensioner dies after superannuation, their family will get family pension that will be 60 per cent of the payout admissible to the payout holder immediately before their demise.

How much lump sum amount will central govt employee get at retirement?

The lump sum amount they will get at retirement will be 10 per cent of monthly emoluments (basic pay+DA) for every completed six months of qualifying service. 

What if one has service years between 10 and 25 years?

In that case, they will get their pension proportionate to their number of pensionable service years.

Calculations for story

We will calculate the monthly pension, family pension, and lump sum for a central government employee with a 12-month average basic pay of Rs 1,02,000 immediately prior to superannuation and 27 years of pensionable service. We are taking a DA rate of 55 per cent.

 

UPS pension for employee with Rs 1,02,000 average basic pay, 27 years of service

The estimated employee pension will be Rs 79,050.

UPS family pension for employee with Rs 1,02,000 average basic pay, 27 years of service

The estimated family pension will be Rs 47,430.

 

UPS lump sum amount for employee with Rs 1,02,000 average basic pay, 27 years of service

The estimated lump sum benefit for such an employee at retirement will be Rs 8,53,740.