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You can get pension from EPFO at the rate of more than 8 percent, you just have to do this

news18 | July 3, 2024 9:52 AM CST

An employee is eligible for a pension if he has contributed to EPFO for 10 consecutive years. This pension is available at the age of 58 years. The employee's pension is calculated on a pro-rata basis, taking into account the number of years the subscriber has been contributing to the pension fund, the average salary for the 60 months preceding retirement, etc.
Pension is available even before the age of 59 years. EPFO allows the employee to take a pension between the age of 50 to 58 years. For this, there is an option for an early pension. However, in this case, the employee will be given a reduced rate of pension. But there is a way through which any employee can draw a pension from EPFO at a rate of more than 8 per cent. Many people do not know this.

As per EPFO rules, a pension is usually paid at the age of 58 years. But if the employee continues to work after the age of 58 years, then he can defer the pension for another two years i.e. till the age of 60 years. And can contribute to the pension fund till then.
In this situation, the employee is paid a pension at an additional rate of 4 per cent per annum. An example will make it clear. If a person takes a pension at the age of 59, he will be given an additional 4 per cent and if he takes it at the age of 60, he will be given an additional 8 per cent. In this case, the contribution to the pension fund after the age of 58 years is considered to calculate the pension.
Early pension can be claimed only when the age is 50 to 58 years. However early withdrawals reduce the pension by 4 percent per year. Let's say an EPFO member decides to withdraw a monthly pension at the age of 56. Then he will get 92 per cent (100 per cent – 2x4) of the total amount of pension. Along with this composite claim form should be filled.
Also if one has served for 10 years but is below 50 years of age, then he cannot claim pension. In this situation, he will only get the money deposited in EPF after leaving the job. Pension will be given only on reaching the age of 58 years.