NPS is a government-initiated product with the sole objective of making retired persons financially self-dependent. It is one of the world's cheapest products and at the same time, gives reasonably good returns.
For a smooth and financially safe retirement, industry experts suggest various instrument options starting from mutual funds, real estate, stocks, to NPS, EPF, etc. Although these are the most common retirement instruments, the National Pension System (NPS) is considered one of the best investment tools for retirement planning in India.
Having said that, even though NPS is considered an ideal option for retirement, its low popularity is due to the lower commission on the sale of the product. However, when compared to other assets in the retirement category, NPS almost stands out with some lucrative features.
NPS is a government-initiated product with the sole objective of making retired persons financially self-dependent. It is one of the world’s cheapest products and at the same time, gives reasonably good returns.
Even though all types of investments come with their own merits and demerits, investments in the NPS are mostly focused on the retirement of the investor. Further, as the subscriber is required to invest at least 40 per cent of the accumulated wealth in buying an annuity, the subscriber gets assured pension monthly.
On the other hand, with the NPS, one enjoys full tax exemption up to the limit of Rs 1.5 lakh under Section 80C. Under Sec 80CCD (1B) subscribers also get tax-exemption of up to Rs 50,000. They can also claim deduction under section 80CCD (2), of up to 10 per cent of their basic salary plus dearness allowances, on the employer’s contribution made towards employees’ NPS account.
Hence, along with tax benefits every financial year, the investors get a pension during their retirement years. Therefore, NPS is ideal for self-employed professionals, especially those working in the unorganized sector.
Availing process for eNPS?
To enrol in eNPS, one must register on the e-NPS portal. In the registration process, personal details like KYC, Photo, Signature, and bank details are to be submitted. An individual has two options available – either through entering the details that they have with their bank or through offline Aadhaar XML.
To help subscribers, some companies such as KCRA have taken recent digital initiatives integrated with the UMANG (Unified Mobile Application for New-age Governance) for providing the NPS services. A subscriber just has to provide the PRAN and their password and after authentication, can avail various NPS services on UMANG Website/App.
Some of the NPS services include;
1. Personal Details View
2. Bank Details View – Tier I & Tier II
3. Nominee Details View – Tier I & Tier II
4. Scheme Details – Tier I & Tier II
5. Total Holding – Tier I & Tier II
6. Scheme-wise Holding – Tier I & Tier II
7. Transaction statement on email
8. Recent 5 contributions
9. Update password, update mobile number, email ID, etc.