EPFO: The biggest guardian of retirement funds is the EPFO. The Employees’ Provident Fund Organization (EPFO) recently made five major changes to the rules of the Employee Provident Fund Scheme (EPS), which will affect the pension accounts of millions of people.

The first major change is the way pensions are calculated. Previously, pensions were based on your last salary, but now they’ll be based on your average monthly salary. This means your pension will be calculated based on your average salary over the last 60 months. The advantage of this is that if your salary has increased gradually, your pension will be stronger. For example, if your last salary was 50,000 rupees but your average was 40,000 rupees, you would have previously received less, but now you’ll receive the correct average. This change has been in effect since September 1, 2014, but it has recently been further clarified.

Increase in pension amount

Second, an increase in the pension amount. The EPFO ​​increased the pension cap from Rs 7,500 to Rs 15,000 per month. This means that if your calculated pension exceeds Rs 15,000, you will now receive the full amount; previously, you would only receive Rs 7,500. This is a boon for those who have a good salary but whose pension was limited. This became possible after the Supreme Court’s decision, and millions of retired people are now expecting higher pensions.

Changes related to pension age

The third change concerns the pension age. The minimum pension age has now been lowered from 58 to 50. If you turn 50, you can still receive a pension, even if you retire at 58. This is a relief for those who need money quickly, such as in a medical emergency. However, remember that while pensions may be slightly lower if you withdraw at a younger age, flexibility has increased.

Online Claim Processing

Fourth, online claim processing has been accelerated. EPFO ​​has strengthened its digital platform, making pension claim submission and approval easier. Now, you can fill out forms, upload documents, and track them from the comfort of your home using an app or website. What used to take months is now done in weeks. This change came after COVID, when everything went online.

Fifth, pension portability has been improved. If you frequently change jobs, transferring your EPS service has become easier. Now, pension calculations will combine service from your old and new jobs, without any breaks. This is beneficial for young people who are involved in startups or freelancing. The EPFO’s unified portal makes this possible.