Securing Hannav Ledger...
Securing Hannav Ledger...
Glossary
Commutation of pension allows a retiree to withdraw a portion of their future pension as a lump sum upfront, in exchange for a reduced periodic pension thereafter.
Trading part of your future monthly pension for a lump sum today.
Common in government pension schemes and NPS annuitisation, where up to a set percentage (e.g. one-third) can be commuted; the remaining pension is proportionally reduced.
A retiree commutes one-third of their pension for an upfront lump sum, receiving a smaller monthly pension afterward.
Trading part of your future monthly pension for a lump sum today.
Commutation of Pension helps you evaluate products, compare options, and make informed decisions aligned with goals, tax rules, and risk tolerance in the Indian financial system.