Ask five people in India how this is calculated and you will get five confident answers, most of them slightly wrong. It is not their fault — the arithmetic is rarely explained, only the result is shown. So let us do it the other way round: first the logic, then the formula, then your own numbers in the nps vs ppf calculator.
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Prefer to start with your own figures? Use the NPS vs PPF Calculator now, or continue for the formula and a worked example.
How this is worked out
PPF pays a fixed rate announced by the government each quarter and credits interest once a year, and the maturity amount is tax-free. NPS is market-linked, so its corpus depends on the return your funds actually deliver; at 60 at least 40% of it must buy an annuity and the pension from that annuity is taxable.
The formula behind it:
PPF: FV = A × [((1+r)^n − 1) / r] × (1+r) · NPS: FV = P × [((1+i)^m − 1) / i] × (1+i)
| Symbol | What it means |
|---|---|
A |
Yearly deposit into PPF |
r |
PPF annual interest rate |
P |
Monthly contribution to NPS |
i |
Monthly return = annual return ÷ 12 |
m |
Total months invested |
Nothing is rounded away quietly and nothing is assumed on your behalf. If a figure appears in the result, it came from something you entered.
A worked example you can follow
₹10,000 a month for 25 years builds roughly ₹82 lakh in PPF at 7.1% and about ₹1.3 crore in NPS at an assumed 10%, of which 40% must buy a pension.
Change any one input and watch the result move — that sensitivity is the real lesson. It is far more useful than memorising a single outcome, because your own rate, tenure or contribution will never match the example exactly.
Using the NPS vs PPF Calculator, step by step
- Open the NPS vs PPF Calculator.
- Enter your figures. Use the ones on your statement, sanction letter or scheme document rather than a remembered number.
- Read the result card — the headline figure plus the breakdown that produced it.
- Adjust one input at a time to see what genuinely moves the outcome.
- Tap Download PDF to keep a copy of the calculation, with your inputs and assumptions printed on it.
The PDF takes a few seconds to build because it is a properly typeset report, not a screenshot. You will see a progress message while it is being prepared, and the download starts on its own.
Practical pointers
- PPF suits money you want guaranteed and tax-free; NPS suits long horizons where you accept market risk.
- Many people use both — PPF for the safe base and NPS for the extra 80CCD(1B) deduction.
Common mistakes worth avoiding
- Treating the assumed NPS return as guaranteed.
- Forgetting that 40% of the NPS corpus is locked into an annuity at 60.
If you want to go a level deeper afterwards, read up on eee vs eet taxation and annuity basics. Both come up the moment you start comparing options seriously.