The National Pension Scheme Chronicles

The National Pension Scheme (NPS) is a voluntary retirement savings initiative in India. Benefits of NPS include tax savings, with deductions available up to Rs. 1.5 lakhs under Section 80C, and an additional Rs. 50,000 under Section 80CCD (1B). Managed by PFRDA, it allows citizens aged 18-60 years, including NRIs, to invest in diverse asset classes like equities and bonds. NPS aims to secure post-retirement income through disciplined contributions, low fund management fees, and regulatory oversight for transparency and investor protection. It serves as a tax-efficient, flexible option for long-term savings, ensuring financial security and peace of mind during retirement years.

The NPS Tier 1 account serves as your primary pension account, mandatory for NPS subscribers. Contributions, including employer's, are invested based on chosen schemes. Withdrawals follow specific rules, with partial withdrawals possible under certain conditions. Tax benefits apply under sections 80C and 80CCD(1B). The NPS Tier 2 account offers flexibility, allowing withdrawals without restrictions, contingent on an active Tier 1 account. It requires minimal initial contribution and lacks annual maintenance charges. However, tax benefits are limited, except for Central Government employees. Both accounts offer investment choices tailored to risk profiles - active or auto-managed portfolios.