National Pension Scheme (NPS)
The National Pension System (NPS) is a voluntary, defined contribution retirement savings plan created to help members make the best choices for their future via methodical saving throughout their working lives.
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NPS KNOWLEDGE BASE (click here)
What is NPS?
What is NPS?
The National Pension System (NPS) is a voluntary, defined contribution retirement savings plan created to help members make the best choices for their future via methodical saving throughout their working lives. The NPS aims to help persons develop the habit of saving for their retirement. It is an effort to discover a long-term solution to the issue of giving each Indian person a sufficient retirement income. The Pension Fund Regulatory and Development Authority (PFRDA) regulates it, and it provides a secure but transparent platform. When people reach retirement age, they get a lump sum payout as well as regular income, allowing them to live a stress-free retirement.
How NPS works?
How NPS works?
Journey with NPS
1. Start at 18 yrs: Begin contributing now and continue every year until you reach the age of 60.
2. Till 60: It's time to retire. Withdraw up to 60% of your savings tax-free and invest the remainder for recurring income.
3. Rest: For a stress-free retirement, take advantage of a monthly pension.
In what areas are money invested in NPS?
In what areas are money invested in NPS?
Depending on your investing strategy and age, your money is invested in a variety of asset classes(Equity, Government bonds, Corporate debts, Risk
Benefits of NPS
Benefits of NPS
Flexible : For planning the growth of investments in a responsible manner and keeping track of the expansion of the pension corpus, NPS offers a variety of investment options and a selection of Pension Funds (PFs). Subscribers have the option of switching from one investment option or fund manager to another.
Simple : When opening an account with NPS, a Permanent Retirement Account Number (PRAN) is given. This special number belongs to the subscriber and is retained throughout his lifetime.
Portable : NPS offers effortless portability between jobs and locations. In contrast to many pension programmes in India, it would allow individual members to move to a new job or area without having to worry about leaving behind the corpus built up.
Well Regulated : NPS is governed by PFRDA, and NPS Trust regularly monitors and evaluates the performance of fund managers. Comparing NPS's account maintenance fees to those of similar pension products offered worldwide, they are the lowest. Cost is crucial when saving for a long-term objective like retirement because fees can significantly reduce the corpus during a 35–40 year investment period.
Dual benefits of low cost and power of compounding : a pension's asset accumulation increases over time with a compounding effect until retirement. Due to the minimal account maintenance fees, the subscriber eventually benefits greatly from the accrued pension wealth.
Once the PRAN account is opened, an online login ID and password is provided to the subscriber. He/she can login and view/manage his NPS account online, over a click.
FAQ's (click here)
Who can invest in a National Pension System (NPS)?
Who can invest in a National Pension System (NPS)?
The National Pension Scheme is open to residents and state/central government employees aged 18 to 60. Existing pension account holders must re-register under the new programme.
What are the Tax benefits under NPS?
What are the Tax benefits under NPS?
A user can invest up to ₹2,000 in order to save 62,400 in taxes.
To be qualified for a tax deduction under section 80CCD, you must invest up to ₹50,000. (1B) - A savings of ₹15,600 in taxes
To be qualified for a tax deduction under section 80CCD, you must invest up to ₹150,000. (1) - ₹46,800 in tax savings
Savings of 46,800 under section 80CCD (1) are an alternative to saving 46,800 on ₹150,000 under section 80C.
Does the government contribute to my NPS?
Does the government contribute to my NPS?
The National Pension Scheme (NPS) is a Government of India attempt to give citizens of India with long-term financial stability. However, the Government will not contribute to your NPS account. Individuals, under the all citizens of India concept, or employee-employer groups, under the corporate model, are the only ones who contribute to the NPS account.
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