National Pension System

What is NPS?

National Pension System (NPS) is a government-sponsored retirement savings scheme designed to help individuals save for their future financial security.

Key Benefits:

1. Low-cost investment

2. Tax benefits (u/s 80C and 80CCD)

3. Flexible investment options

4. Professional management

5. Portable across jobs and locations

6. Regulated by PFRDA (Pension Fund Regulatory and Development Authority)

Types of NPS Accounts:

1. Tier I: Retirement account (lock-in until retirement)

2. Tier II: Voluntary investment account (withdraw anytime)

Eligibility:

1. Indian citizens aged 18-65

2. Resident and non-resident Indians (NRIs)

Contribution:

1. Minimum ₹500 (Tier I) or ₹1,000 (Tier II) per annum

2. Maximum ₹1.5 lakhs (u/s 80C) and ₹50,000 (u/s 80CCD)

Withdrawal:

1. 60% lump sum at retirement (age 60)

2. 40% annuity/pension