NPS: Opening an account under the National Pension System is easy and its account can be opened sitting at home and invested with a fixed amount every month.
National Pension System
Do you want to live your life peacefully after the age of 40? If yes, then you should start planning for retirement now. Most of the people do not think about retirement and keep working till the age of retirement. Experts recommend that people should start retirement planning early. You can prepare for retirement with even a small amount.
If you are thinking of retirement, then the National Pension System can be a very good option. This is a government scheme. With the NPS scheme, you can make a minimum contribution of around Rs 6,000 in a financial year in the form of monthly installments of Rs 500. Any Indian citizen in the age group of 18 to 70 years can enroll in this scheme.
Easy to open account in NPS
The NPS scheme is one of the ideal pension and retirement planning schemes available in India for salaried, self-employed professionals and freelancers. Opening an account under National Pension Scheme is easy and its account can be opened sitting at home and invested with a fixed amount every month.
NPS is operated by the Pension Fund Regulatory and Development Authority (PFRDA), so it is quite safe. PFRDA monitors this entire system.
Benefits of NPS-
>> The NPS route gives higher returns as compared to traditional tax-saving investment options like PPF, as it invests the contribution in equities. This is a good option for those who want to lead a comfortable life after retirement as it can fetch an interest rate of 9 to 12 per cent depending on the type of NPS account you choose.
>> In NPS, customers also get the facility of tax exemption. Tax exemption is available under section 80CCD(1), 80CCD(1b) and 80CCD(2) of the Income Tax Act. In addition to Rs 1.50 lakh under section 80C, you can take an additional deduction of Rs 50,000 on NPS. By investing in NPS, you can avail income tax exemption of up to Rs 2 lakh.
>> Under the National Pension System, you can withdraw 60 percent of the money after the age of 60. That is, after 60 years, you can withdraw 60 percent of your maturity amount without any tax.
>> Although one has to invest in NPS till the age of 60, but in case of emergency, you can withdraw 25 percent of the amount before the completion of 60 years. However, for this you have to invest continuously for the first 3 years. You can withdraw money from NPS if you want your children’s education, their marriage, construction of house or any medical treatment for yourself or any family member.
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