In this video conversation, we are discussing that Commutation of Pension is beneficial or not, Commutation of Pension Rules, what is commutation of pension, calculate commutation of pension, commutation of pension calculation, commutation on retirement, commutation of retirement benefits, etc.,
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Commutation of Pension Calculation Video
Commuted Value of Pension Table:
Commutation Factor Table:
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#commutation
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Commutation of Pension is beneficial or not
A topic that often sparks debate and discussion among retirees is the commutation of pension. Commutation refers to the conversion of a portion of one’s pension into a lump sum amount. While this option may seem appealing to some, others raise concerns about the long-term implications and potential drawbacks. Let’s analyze whether the commutation of pension is indeed beneficial or not.
One advantage of commutation is the immediate access to a lump sum amount of money. This can be advantageous for individuals who have urgent financial needs or want to pursue certain goals or investments. For example, someone may need the funds for medical expenses, education fees, or even to start a business. Commutation provides retirees with the flexibility and freedom to use the money as they see fit, without any restrictions.
Moreover, commutation can also help individuals clear off outstanding debts or mortgages, alleviating the burden of ongoing financial obligations. It can provide a sense of financial security and peace of mind, knowing that one’s major expenses are taken care of.
Furthermore, the lump sum amount received through commutation can be invested wisely to generate additional income. By investing in real estate, mutual funds, stocks, or other profitable ventures, retirees can potentially increase their overall wealth and enjoy a higher standard of living. This option allows individuals to take advantage of market opportunities that might not be available to them if they were solely relying on their monthly pension payments.
On the other hand, there are potential downsides to consider when opting for commutation. One of the main concerns is the loss of a regular monthly income. By choosing a lump sum payment, retirees forfeit their fixed pension amount and rely entirely on the lump sum received for their financial needs. This can be risky, especially when considering the uncertainties of the future, such as inflation, rising living costs, or unforeseen circumstances.
Another drawback is the tax implications that come with commutation. In many jurisdictions, the lump sum received through commutation is subject to taxation, which can significantly reduce the overall amount. Retirees must be cautious and evaluate the tax consequences before deciding on commutation, as it may not be as financially advantageous as initially perceived.
Moreover, individuals who choose commutation may face the temptation to spend the lump sum amount impulsively or without proper financial planning. Without a disciplined approach, the funds could be depleted quickly, leaving retirees vulnerable to financial hardships in the long run.
Additionally, in certain cases, the commutation of pension may result in a lower overall pension amount over time. This is because the commuted portion of the pension is subtracted from the total pension amount, leading to lower monthly payments in the future. Retirees must assess their financial requirements and future needs carefully to determine whether a lump sum payment is worth sacrificing a portion of their regular pension income.
In conclusion, the commutation of pension can be both advantageous and disadvantageous, depending on an individual’s circumstances and financial goals. It offers immediate access to a lump sum amount, providing financial freedom and flexibility. However, it comes with the risk of losing a regular monthly income and entails tax implications to consider. It is crucial for retirees to thoroughly evaluate their financial situation, consult with experts, and weigh the pros and cons before making a decision. This will ensure that they make an informed choice that aligns with their long-term financial well-being.
Part 2 of this Video: Income Tax on Commutation of Pension
https://youtu.be/JOumQ05WJSM
Department not giving option for commutation.
Sir kya 41 versh 10 maah ki service ko commutation of pension ki calculation mai 42 versh maanker agle birthday yani 43 year ke factor table mai dekhenge
क्या एमपी सरकार मैं पेंशन बिक्री प्रावधान है
Good info sir but, after retirement fifteen years, who see this amout, because if employee dies, it's benifit to govetnment, automatic recovery is not available by government,
Mera All. Deshwasiyon se PRAARTHANAA hai ki modi. Se. Desh. Ko. Bachao. Tabhi Desh ka. Kuchh hoga.
Sir ji BJP Govt. MODI. ne to INDIAN. ARMY. ko. NILAAM. KR DIYA HAI.
Excellent Sir
इसके ईलावा commuted portion पर 15 साल तक DA भी नहीं मिलेगा । ये भी तो नुक़सान है ।
Thank you sir for the valuable information.
Absolutely Beautiful and Excellent dear sir.
If the pensioner dies before 15 years of his retirement, will the comnutation value will be recovered for the remaining period?
Normal fd account is better. Life is too short. Govt. Old pension scheme se dar rhi Hai. Aaj koi bhi badi muskil 60-62 Saal pure karta Hai. Yehi halat uski wife ki Hai. Isliye old pension scheme centre Govt ko Lagu Kar deni chahiye isme jyada loss nhi. Average life 65 yrs. Warna pachhtana padega. Gidd is desh ko kha jayenge. Samay Rahte state ya centre Govt samajh le warna Matha pitenge. Ye lobhi lalchi insano ka desh Hai.
वैसे 60year वाले के लिए तो सही है पर अराउंड 50 पे कोई vrs ले रहा है तो उसके लिए सही नहीं है,
अगर कोई 10000 ₹ की सिप कर ले 15 साल तक तो कम से कम 1 करोड बना लेगाmin 15% की दर से
You have not taken into account the impact of TDS in the example.
उच्च व्याज वाली योजना में पैसा लगाना तो ठीक है। परन्तु आयकर कितना कटेगा , इन 15 वर्ष में इसकी आपनें कोई कैलकुलेशन नहीं की। इसलिए आपका वीडियो अधूरा है
May be
Good morning sir ji Apne jo Ray di bahut achha hai.
Excellent!
Thank you.
Sbi me yha fd ka prawdhan h ka
Thank you very much for the efforts taken in informing the benefits of commutation of pension. In the entire episode you have concentrated and explained as to how it is beneficial to the pensioner when the pensioner invested in savings schemes of any Bank or so. It is no doubt that it is true.
My point to be raised here is that the intention of the Government in providing a provision to commute certain portion of pension at the time of retirement is one of the previlege extended to the pensioner among other benefits such as gratuity, tax free etc., without expecting any interest from the retired employee.
Here, I would like to put an example as to how the policy is not good and is loss to the pensioner:
I was retired from the State Govt. on 31-12-2009 on attaining the age of retirement of 58 years. My basic pension was fixed at Rs. 20,000-00 w.e.f. 01-01-2010. I have opted for commutation of pension 5,00,000/- to be recovered at Rs. 5000/- per month. As per the existing Rules my full pension will be restored after completion of 15 years only. In my case it falls on 31-12-2025. Accordingly the total commuted pension at Rs. 5000/- per month for 15 years works out Rs. 9,00,000/- ( 5000 x 12 x 15) resulting excess recovery of Rs. 4,00,000/- ( 9,00,000 – 5,00,000 ). This appears to be inevitable as per existing rules. So, is this justifiable on the part of the Govt., to do so? And there is no provision for restoration of full pension prior to completion of 15 years. In my case at the rate of Rs. 5000/- CVP per month I have totally repaid my commuted pension by 30-04-2019 itself i.e., in 100 months. But still the authorities are recovering CVP at 5000/- rupees per month without giving any option for me to restore my full pension.
I, therefore question as to why this discremination incurring loss to the retired employee. Is there any provision to repay the excess amount recovered from the pensioner and is there any provision to pay any interest for the excess recovery of the pension amount? Kindly reply.
I request the pensioners to probe deeply in the matter in respect of their individual cases and calculate as to how much amount they lose or going to lose due to these restriction of 15 years threshold put by Govt. for restoration of full pension. Thank you one and all.
sir… you have made a brilliant video explaining what i exactly needed. thank you!
Nice video
Very interesting & knowledgeable video. Thanks.
Very nice video
मैंने cda से rti मांगी थी कि campute 9 में पूरी होती है 46 साल की age के लिए तो फिर 15 साल में restore क्यों जबकि हम अपनी पेंशन से ही एडवांस ले रहे हैं न कि कोई कर्ज ले रहे हैं ऊपर से ये भी पूछा कि किस रेट से इंटरेस्ट ले रही है। लेकिन cda कोई रेट नहीं बता पाई। पेंशन रेगुलेशन में भी कहीं नहीं लिखा है। जो आप बता रहे हैं ये rate of interest कहां लिखा है
Very interesting. Sir
ATI Sundar jankari compute Lena hi samajhdari
1) Agar immediate requirement ho to commutation leke FD kese karega, to ye to lena or interest ke liye FD irrelevant ho gaya. 2) Agar 8% higher rate par invest kar bhi de to jo 15 saal me extra repay karna pada (commuted amt received – repaid in 15 yrs) wo loss bhi to total interest received se minus karna padega to total profit from interest kam ho jayega. So, nutshell me kahen to commutation tabhi opt karen agar immediate requirement ho to, isme profit from interest ya comparison na karen, otherwise loss hoga.
Bjp is not giving higher pension. No pension no votes
I used the commuted amount for my daughter's marriage. So, I think it's beneficial to opt for commutation. Now max limit is 50% and not 40%
Commutation lene walo ka interest minus nahi kiya table me. Jo ki 11 lakh hai approx.
gr8 SBI ever time higher profit-making unit. Here you will get one stop solutions#WeareWithSBIAHM
Sar kya commute ki Hui pension 15 sal pure hone ke bad family pensioner ko milati hai ya nahin
बहुत नुकसान है।एकदम नहीं बेचना चाहिए।
कम्यूटेड पेंशन ग्यारह वर्ष बाद पुनर्जीवित की जानी चाहिए क्योंकि कम्यूटेशन के फलस्वरूप मिलने वाली धनराशि कम हो जाती है। पहले कम्यूटेशन कराने पर रु 124.50 मिलता था और वर्तमान में रू 8.194 है।
इसलिए commuted पेंशन को 11 वर्ष में कर देना चाहिए।
It’s not so simple. Income tax deduction should also be considered for all calculations
Thanks for your valuable information. Pl suggest one more thing that, what is the scheme where we can get higher interest rate ie 8%
बहुत बढ़िया जानकारी गुरुजी
Bholanath Chowdhury Naik 1985 retirement Aya may 45percent investment Kia lekin 15sal bad 100rupee mili. Mera ki kuch milega?
May bohut kasto. Me Mera chalta hay. Mera beta handicraft hay.kuch Nehi kar pata hay. Ham 5admi rahate hay. Computetion milega to bohut upokar hoy.
पेंइ कम्यूटेशन कराने पर नुकसान ही है। मध्यप्रदेश लेखा सेवा अधिकारी के अनुसार ।
Thanks for ur explanation
Sir नमस्कार मैं एक आर्मी रिटाइटेड एम्प्लोयी हुँ और ऐ जानना चाहता हुँ की जब मैं रिटायर हुआ to मेरी बेसिक बहुत कम थी और उस आधार पर मेरा commute कट रहा था और अब जब 15 साल हो जाएंगे तो बेसिक में काफ़ी अंतर आ गाया हैँ तो क्या जब पूरी पेंशन मिलने लगेगी तो जो शार्ट ammount कट रहा हैँ उसी को 40% मान कर जोड़ा जायेगा या फिर आज के ammount के बेसिक का 40% लगेगा l कृपया बताएं जैसे की उस समय अगर मेरा commute ₹10000 जाना शुरू हुआ था और बेसिक ₹180000 थी और इस समय commute वही ₹10000 जा रहा हो पर बेसिक ₹40000 हो तो क्या होगा
Sir airforce me jo 20 saal me out ja raha usko kitna milega sab kuch milake. Jaroor batana sir
Sir what be be the effect of DA on commutation.