LIC New Jeevan Shanti Plan (758) Calculator

LIC New Jeevan Shanti Plan (758) Calculator

What this calculator does

LIC's New Jeevan Shanti (Plan 758) is a single premium deferred annuity plan - you pay a lump sum (the purchase price) once, but unlike an immediate annuity plan, the pension (annuity) does not start right away. Instead, you choose a deferment period (how many years to wait before payouts begin), and during that period LIC credits guaranteed additions to your purchase price. Once the deferment period ends, LIC starts paying you a regular annuity for life, calculated on the grown-up amount rather than the original purchase price alone.

This calculator gives you an indicative estimate of:

• the guaranteed additions that accrue on your purchase price during the deferment period
• the vesting amount (purchase price + guaranteed additions) available for annuity once deferment ends
• the annual annuity and per-installment annuity it would buy, for your chosen annuity option and payment frequency
• the effective annuity rate (annual annuity as a % of your original purchase price)
• a comparison across different deferment periods, so you can see how waiting longer before payouts start changes your eventual annuity

based on your current age, purchase price, chosen deferment period, annuity option, and (for joint-life) your spouse's/joint annuitant's age.

Formula Used

Guaranteed additions accrue as simple interest on the purchase price, at a rate that rises with the deferment period you choose (a longer deferment means LIC holds your money longer before paying out, so it credits a higher rate):

$$GARate(years) = \text{interpolate}\big((1, 3.0\%), (3, 3.75\%), (5, 4.25\%), (7, 4.75\%), (10, 5.25\%), (12, 5.5\%), (15, 5.75\%)\big)$$ $$GuaranteedAdditions = PurchasePrice \times GARate(DefermentYears) \times DefermentYears$$ $$VestingAmount = PurchasePrice + GuaranteedAdditions$$

Once the deferment period ends, the annuity is calculated on the vesting amount, at a base rate that depends on your vesting age (your current age plus the deferment period) - since an older annuitant has a shorter expected payout period, the rate rises with age:

$$VestingAge = CurrentAge + DefermentYears$$ $$BaseRate(age) = \text{interpolate}\big((31, 5.0\%), (40, 5.4\%), (50, 5.9\%), (60, 6.6\%), (70, 7.6\%), (80, 8.9\%), (94, 10.0\%)\big)$$

For joint-life deferred annuity, both the guaranteed-addition growth and the base rate use the younger of the two annuitants' current ages (since payments continue until the second death), and the payout is scaled down slightly since it must cover two lives:

$$EffectiveAge = \min(YourAge, JointAnnuitantAge)$$

The base rate is then scaled by an option factor and a payment-mode factor:

$$AnnualAnnuity = VestingAmount \times BaseRate(VestingAge) \times OptionFactor \times ModeFactor$$ $$InstallmentAmount = \frac{AnnualAnnuity}{InstallmentsPerYear}$$

Option factors used: Single Life Deferred Annuity = 1.00, Joint Life Deferred Annuity = 0.92 (joint life pays a little less for the same vesting amount, since it must cover two lives).

Payment-mode factors: yearly 1.00, half-yearly 0.995, quarterly 0.99, monthly 0.98.

Note: these rates are illustrative approximations for planning purposes, not LIC's official rate card, which varies by IRDAI-approved tables and can change over time. Always confirm exact figures with LIC or an authorized agent before purchasing a policy.

How to Use

1. Enter your current age (30 to 79 years, as required for this plan).
2. Enter the purchase price (the lump sum you plan to invest) - minimum ₹1,50,000.
3. Choose a deferment period (1 to 15 years) - the longer you wait, the more guaranteed additions accrue, but the later your pension begins.
4. Choose an annuity option: Single Life or Joint Life Deferred Annuity.
5. If you choose Joint Life, enter the age of your spouse/joint annuitant.
6. Choose how often you want the annuity paid once it starts - yearly, half-yearly, quarterly, or monthly.
7. Click Calculate Deferred Annuity to see your guaranteed additions, vesting amount, estimated annual and per-installment annuity, effective annuity rate, and a comparison across different deferment periods.

Worked Example

Suppose you are 45 years old, invest a purchase price of ₹10,00,000, choose a 5-year deferment period, the Single Life Deferred Annuity option, and want the annuity paid yearly.

• GARate(5) = 4.25%
• GuaranteedAdditions = 10,00,000 x 0.0425 x 5 = 2,12,500
• VestingAmount = 10,00,000 + 2,12,500 = 12,12,500
• VestingAge = 45 + 5 = 50
• BaseRate(50) = 5.9%

$$AnnualAnnuity = 12{,}12{,}500 \times 0.059 \times 1.0 \times 1.0 \approx 71{,}538$$

So after waiting 5 years, this purchase price would fetch roughly ₹71,538 a year for life - an effective annuity rate of about 7.15% on your original purchase price, higher than an immediate annuity would pay at age 45, because of the 5 years of guaranteed additions plus the higher base rate at the older vesting age.