#national pension scheme

[jacobsaini41]

Know how to achieve a monthly pension of Rs. 1,00,000 with the National Pension System (NPS). Learn about investment options and retirement planning with NPS.

[kfintech]

Open NPS Account Online | NPS Account Opening | KFintech

National Pension Scheme (NPS) is a government-sponsored pension scheme to provide income security for all sector citizens. Apply for National Pension System Online at NPS KFintech.

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When and How to Plan for Your Retirement?

Retirement is one of the biggest expenses that a person needs to consider. During the retirement years, you’re not earning anymore, but you still need to pay for your expenses. The period of retirement can also be very long with rising life expectancy. The average age that people live in India is now around 72 years, but it can be much higher by the time you retire. The biggest question that people have when they think of retirement is – how much money will I need? This is a complex question, and you need to think carefully about it. The answer depends upon a range of factors such as the lifestyle you want at retirement, whether you own a house, whether you will receive a pension, what the inflation rate will be, and so on. In this article, we’ll try to provide the tools that you need in order to arrive at the answer.

Importance of Having a Retirement Corpus

A retirement corpus is a sum of money that you save during your working years. This money is then used to fund retirement. The retirement corpus should be large enough that it generates monthly income on which you can live. The retirement corpus will slowly vanish over time, as you will consume the funds. As most people retire by the age of 60, they need money in order to meet their expenses. Those who do not accumulate a sufficiently large retirement corpus may need to dramatically lower their cost of living. They may even need to rely on their children or other relatives. Or, they may have to work during their golden years as well. None of these options are ideal. Hence, retirement planning is essential for everyone.

When to Start Saving for Retirement?

You should start saving as early as possible. In fact, ideally, you should set aside a small portion of your income from your first earnings itself. This is much easier said than done. This is why most experts agree that you should give yourself around 20 to 30 years to build your retirement corpus.The age at which you start saving for retirement also depends on the other big expenses in your life. How many kids are you planning on having? Are you planning on buying a house? Do you have generational wealth that you can rely on? Are you a single-earner for your family?Depending on the answer to these questions, you can start saving earlier or later. Most people should start saving and investing for retirement at the age of 30, assuming a retirement age of 60.Retirement is a huge expenditure in every person’s life. Even though retirees usually live a low-cost life, the fact that they will not be earning any money for decades means that you need to have an appropriately large amount of money as your retirement fund.

How to Calculate the Amount for Retirement Corpus?

The appropriate retirement corpus depends from person to person. There is no single answer that will suit everyone. However, there are certain factors that each person must keep in mind while calculating their retirement corpus. These factors are: Inflation – How much average inflation there is during your accumulation phase and during your retirement years? The average answer is usually around 6% per year, but it can vary depending on what you consume. Monthly Expenses –What is the monthly amount that you will be spending during your retirement years? You need to decide what kind of lifestyle you want after you’ve retired. Are you going to spend less? Are you going to spend more? What will be your expenses after retirement? Rate of Returns – What is the rate of interest you’re earning from your savings and investments? Usually, fixed-income investments provide a lower rate of interest while riskier market-linked investments provide a higher rate of interest. You can decide which type of investment to aim for depending on your goals and risk appetite. How to Build Retirement Corpus? The best way to build your retirement corpus is to save a portion of your monthly income and then invest it. For example, you can save around 10% on your monthly income and then deposit that money into a recurring deposit account held with your bank. This will provide guaranteed (but low) returns for a long period of time. For salaried employees, 24% of the basic salary is deducted from the provident fund. You can also invest up to 10% of your basic salary in your provident fund and also avail tax benefits. There are several ways you can invest your money depending on what your desired retirement life looks like, how many years you have till retirement, how much your present and future earnings are, and what your risk appetite is. A few of the ways in which you can invest your money are a provident fund, NPS and other pension plans, fixed deposit, recurring deposit, government or corporate bonds, mutual funds, real estate, or even riskier methods.

Wrapping Up

The question of retirement should be tackled as early as possible. This is because the earlier you start saving, the less you’ll have to save in total. Keep in mind that inflation could triple or quadruple your monthly expenses when compared to today. This is why saving and investing your money in a prudent manner is the best option.

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[merisarkar]

National Pension System: जानिये क्या लाभ हैं NPS में निवेश करने के

National Pension Scheme (NPS): सरकार द्वारा चलाई जा रही पेंशन योजना नेशनल पेंशन स्‍कीम (NPS) तक अ�� गांवों या कस्‍बों में रह रहे लोगों की भी पहुंच आसान हो जाएगी। पेंशन फंड रेगुलेटरी एंड डेवलपमेंट अथॉरिटी (PFRDA) ने कहा है कि सभी की पेंशन योजना NPS तक आसानी से पहुंच हो, इसके सभी बैंक शाखाओं और पोस्‍ट ऑफिस में यह उपलब्ध कराने के प्रयास किए जा रहे हैं। PFRDA ने NPS के डिस्‍ट्रीब्‍यूशन के लिये…

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[financedesks]

The Indian Government is now mulling over a plan to hand out its employees a minimum pension, which would be 40-45% of their last-drawn salary, by changing the current market-linked pension scheme. For more details visit our blog.

[greythrsoftware]

Masterclass on National Pension System

What is NPS?

Popularly known as the National Pension Scheme, the National Pension System is a voluntary contribution-based retirement savings scheme designed to help subscribers make systematic savings during their working life.

NPS is regulated by a government agency called Pension Fund Regulatory and Development Authority (PFRDA). Introduced in 2003, NPS was provided only to government employees. In 2009, private sector employees and all Indian citizens became eligible for it. Any Indian citizen aged between 18 and 65 years is eligible to join the scheme.

What are its salient features?

NPS is a low-cost investment compared to other investments like mutual funds, debt funds or equity funds. It offers tax breaks for individuals. Since it is a market-linked scheme, the returns will be high if the market performs. Even in terms of contributions, NPS also offers more flexibility compared to other products.

What are the different types of accounts under NPS?

There are two types of accounts: Tier 1 accounts and Tier 1 accounts. One must open a Tier 1 account before opening a Tier 2 account; which means a Tier 1 account is mandatory to open an NPS account.

A Tier 1 account has some withdrawal restrictions since there are significant tax benefits. The Tier 2 account is like a voluntary savings scheme where the members can withdraw the amount anytime without any restrictions. But there are no tax benefits. A Tier 2 account is similar to a bank account. However, it earns returns based on fund performance since it is completely linked to the market.

What are the steps to open an NPS account?

It is similar to opening a bank account. By submitting a form and the KYC documents, an NPS account can be opened within a few hours (if done right). If the Aadhaar is available, the individual can link the KYC to the Aadhaar and open the online NPS account (on the NSDL portal) within minutes, and get a permanent retirement account number (PRA). Contributions and withdrawals can be made online.

Are there any tax benefits for NPS contributions?

Tax benefits under NPS apply only to Tier 1 accounts. Any NPS subscriber can claim a tax benefit of up to INR 1.5 lakhs under Sec 80CCD (1), and an additional deduction of up to INR 50,000 is available under 80CCD (1B). The employer’s contribution of up to 10% of salary (Basic + DA) will also be deducted.

In the Tier 2 account, only the contributions made by government employees qualify for a deduction under Section 80C. The limit is INR 1.5 lakhs, and the lock-in period is three years. However, the Tier 2 account doesn’t offer additional tax benefits beyond those available under regular income tax laws.

What are the minimum contributions for different NPS accounts?

Tier 1 account: The minimum amount per contribution is INR 500, and the minimum contribution per year is INR 1000. There is no limit to the number of contributions that can be made in a year, but at least two contributions (in a financial year) are mandatory.

Tier 2 account: The minimum amount per contribution is INR 250. However, a minimum contribution of INR 1000 is required for account activation. Unlike the Tier 1 account, there are no mandatory contribution requirements for the Tier 2 account, and the subscribers can choose to contribute as per their financial goals.

How do NPS contributions through employers work?

Unlike PF, where equal contributions are required, NPS contributions are flexible. The same can differ from employer to employer and also between employee and employer. The contributions can also be unequal between the employer and employee.

What is the NPS interest rate, and how do we calculate it?

In the case of NPS, the government does not guarantee any return on the investment, since it is completely market-linked and based on the fund performance. Past trends show an average yield of 9% to 12%.

If you log in to your account, at the end of the year, you can see the percentage of return from the fund to date.

How does taxation work during withdrawal or retirement?

Subscribers can choose to make a withdrawal anytime between 60 years and 75 years of age. Although the person can continue the fund till the age of 75 years, the contribution has to stop at the age of 65.

A maximum of 60% and a minimum of 40% can be withdrawn as a lump sum. If 60% is withdrawn, it is entirely tax-free. If 40% is withdrawn, it has to be invested in an annuity that generates a tax-free monthly pension.

As per a recent amendment, if the total corpus is less than five lakhs, 100% withdrawal can be made.

Can NPS be withdrawn before retirement? If yes, what is the process?

Partial withdrawal is allowed for higher education/marriage of children, purchase or construction of a house, treatment of specified diseases and self-employment/set of a startup. But the subscriber should have also completed at least three years in the NPS scheme. There is also a limit of three withdrawals before 60 years. Withdrawal (only 25%) before three years is permitted only for expenses related to skill development, reskilling or self-development activities. Such a withdrawal is completely tax-free.

If there is an individual NPS account, the subscriber can merge the same with the new company’s corporate account. All future contributions will be made to the same account. If there is an existing corporate account, the person can request inter-sector shifting with the aid of an ISS form.

What are the fees/charges levied if the minimum contributions are not made?

NPS charges are considered minimal when compared to other investment schemes. To open an NPS account, an initial registration charge of INR 200 is levied; this can go up to INR 400 depending on the service provider and the amount of contribution. For subsequent contributions, a service charge of 0.5% is charged; this is reduced to 0.2% for online transactions.

A maintenance charge of INR 100 per annum is recovered quarterly, and a fee of INR 32 is charged for non-financial transactions such as a change of address. If the minimum contribution is not made in a financial year, there is no penalty, but the account will be frozen, and no transactions can be made until reactivation.

In Conclusion

Now that you understand NPS better, you may be eager to learn more. If so, we invite you to listen to the webinar recording, where the expert answered more questions.

Please note: As the government may make amendments to the laws, it is important to refer to official websites and documents for the latest information.

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[jacobsaini41]

Ready to open your corporate NPS (National Pension System) account hassle-free? Look no further! In this step-by-step guide, we show you how to effortlessly open your corporate NPS account in minutes with HDFC Pension and Protean. 

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[kfintech]

KFintech NPS - Open NPS Account Online | National Pension System

National Pension Scheme (NPS) is a government-sponsored pension scheme to provide income security for all sector citizens. Apply for National Pension System Online at NPS KFintech.

[farsightgroup]

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[payalsmc]

A senior citizen pension plan is an investment plan that gives you a stable income in your retirement days. This scheme gives regular income to the people in their old age and also gives tax benefits. Read about the scheme, it’s benefits, and the types of pension plans available in India in this blog.

[hdfcsales]

Except for OCI, PIO, and HUF, any Indian citizen between the ages of 18 and 65, including NRIs, may enroll in the National Pension Scheme (NPS). The Indian government prefers it.

[poonamranius]

NPS Retirement Plan: रिटायरमेंट के बाद हर महीने 1.5 लाख रु की होगी जरूरत, नौकरी रहते कैसे पूरा सकते हैं टारगेट

NPS Retirement Plan: रिटायरमेंट के बाद हर महीने 1.5 लाख रु की होगी जरूरत, नौकरी रहते कैसे पूरा सकते हैं टारगेट

NPS Retirement Plan जिस तरह से महंगाई बढ़ रही है, भविष्य के लिए फाइनेंशियल प्लानिंग न करना एक बड़ी चूक हो सकती है. महंगाई दर देखें तो आज का खर्च 30 साल बाद यह 3 गुना हो सकता है. NPS Retirement Plan National Pension Scheme Retirement Plans: फाइनेंशियल एडवाइजर कम उम्र से ही निवेया करने की सलाह देते हैं, खासतौर से अपने रिटायरमेंट के लिए. वैसे भी जिस तरह से महंगाई बढ़ रही है, भविष्य के लिए…