The central government launched the National Pension System in the year 2004. NPS works as a market-linked scheme and offers advantages of building a retirement fund while also providing pension benefits.
Atal Pension Scheme is a remarkable investment opportunity launched by the central government. The beneficiaries under this scheme receive a pension of Rs 5000 per month, however, taxpayers are not eligible to apply for it. If you do not qualify for the Atal Pension Scheme, there are more options available for you. Today, let’s learn about the National Pension System that will help you make your future financially secure.
National Pension System
The central government launched the National Pension System in the year 2004. This scheme is best for people who are not eligible to receive benefits from the Atal Pension System. NPS works as a market-linked scheme and offers advantages of building a retirement fund while also providing pension benefits.
How to apply for NPS
• To apply for the NPS scheme, first find out about your Point of Presence (PoP) where NPS accounts can be opened.
• Visit the PoP and request for an application form.
• Fill out the application form and attach the necessary KYC documents. Submit the form.
• Upon successful submission, you will be issued a Permanent Retirement Account Number (PRAN). This will be your identification number for using your NPS account.
To enrol for the scheme, you may need to pay a registration fee.
Types of accounts
Under National Pension Scheme, two types of accounts are offered which are Tier 1 and Tier 2. Tier 1 requires a minimum investment of Rs 500, and Tier 2 requires a minimum investment of Rs 1000 and is a voluntary account.
Beneficiaries receive 60 percent of the accumulated amount at the time of retirement, while the remaining 40 percent is provided in the form of pension. Moreover, there is no upper limit on investments in this scheme.
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