It's time for action.

If you need help

or have any questions, simply reach
out to us. Our contact details are
shared below.

Atal Pension Yojana National Pension System

Online APY subscriber registration Open your NPS account online
enps.nsdl.com/eNPS/ www.npstrust.org.in/content/
ApySubRegistration.html open-your-nps-account-online
If you are between 18 and 40 years, you can
join Atal Pension Yojana. To know more about NPS or your nearest
Contact your nearest bank/post office POP-SP(Distributor), call our toll free
branch, call 18008891030 (toll-free) or visit number 1800222080, SMS NPS to 56677
www.pfrda.org.in today. or visit: www.pfrda.org.in.

Financial Literacy and Training Department, PFRDA.

Retirement
Education and
Awareness
Programme
Pension Fund Regulatory and Development Authority

EARN your freedom from

financial worries — REAP the benefits
Contents
1 Understanding Retirement 2

2 Factors to Keep in Mind

7

3 Pension Product Features:

11
Key Considerations

4 The Magic of National Pension 15

System

5 The Power of Atal Pension 25

Yojana

Afterword 29

Glossary 30

Hello.
My name is
Professor Moneyram.
I am happy to see so many of you
interested to know about
retirement planning and savings.
What I am about to share with
you today, applies to an
18-year-old as well as someone
who’s 70.

Disclaimer
The information contained in this booklet is for illustrative, informational and educational purposes
only and does not necessarily represent the views or opinions of PFRDA. PFRDA does not make
any representation or warranties with respect to accuracy, applicability, fitness, or completeness
of content in the booklet.

First edition May 2022. Reproduction is permitted provided the source is acknowledged.
Chapter 01
Understanding Retirement

Close your eyes and imagine a time

when you are no longer working. What
do you see?

Do you see yourself relaxing, spending

your time peacefully, visiting your
children or grandchildren
and vacationing?

That stage in your life, my friends, when you

stop working and live on your accumulated
savings is called retirement.
It is a stage for which you need to save
enough, so you can lead the life you
just imagined.

Running Medical
your house expenses

Your needs Recreational

and your activities and
family's vacations
Even after your retirement, you’ll need
enough money for these.

This is possible if you EARN your

freedom — freedom from financial constraints
and worries — right from the early stages of your
working life.
Which means, it’s time for you to take
Early Action for Retirement Needs.

Are you ready?

2
 Planning your retirement
Planning your retirement means saving So let’s take a guess at what you
enough to ensure that you can continue think the average life expectancy
to meet your needs for the rest of your today is.
life. In other words, it is the process of
determining how much money you will Anyone? Well, the fact is that most
require to live comfortably after your of you will live for many years after
retirement. you retire because life expectancy
has increased with healthcare
For that, you will also have to figure out advancements.
how much time is left before you reach
your golden years.

In India, the average person today goes on to

live more than 20 years after retiring at 60.

EXPENSES

1990s - 2020s

You'll therefore need sufficient funds to cover your everyday needs in retirement.

But without proper planning, you may you to seek re-employment. However,
end up with lower retirement wealth. if you plan now, the chances of running
Which means, you would not have out of money later are fewer.
enough money to manage your monthly
expenses. Such a situation could force

So plan your retirement today and

EARN your freedom tomorrow!

3
Pension for everyone
So friends, do you know what your best Upon retirement, you can rest easy
bet in retirement planning is? The because you will have enough funds
answer is much simpler than to enjoy a comfortable life.
you thought. It’s one word — pension.
Yes, pension is your bread and butter
for retirement years.

With a pension, you Pension comes from a pool Pension lets you take
receive a guaranteed, of money set aside for the care of your needs and
fixed monthly amount years you don’t work dreams after retirement

But do you think pensions are only for government employees? Or for your
peers employed in private companies? It would be a mistake to think like that.

My dear friends, everyone can get a

pension — even you.

4
 Start early, save more
When do you think you should start The earlier you start, the greater
planning for your retirement? NOW. retirement wealth (read peace of mind)
Yes, you heard it right. you will have in your golden years.

You can plan for your retirement at

any age between 18 and 70 years.

Let me give you an example.

Monthly Investment Required

Your current age = 25 years ₹10000
Value of monthly expenses = ₹ 10,000
Your retirement age = 60 years
Age till which you want to plan = 80 years
₹4500
Assumptions ₹3700

Inflation = 5% ₹2811
Return on pension investment = 10%

18 25 30 45

Age (in years)

Here are some scenarios I have put up for different ages. You will find under each
the inflation-adjusted value of monthly expenses, amount needed to be invested
on monthly basis and the required retirement wealth at 60 years.

25 30 45
Age (35 years remaining (30 years remaining (15 years remaining
for retirement) for retirement) for retirement)

Value of
expenses 55,160 43,219 20,789
at 60

Amount to
be invested 2,236 2,942 7,720
per month

Corpus
required 85 lakh 67 lakh 32 lakh
at 60

5
 Start early and save for your pension
over many years..
That way, you’ll have comfortable later years — even if you decide to retire early.

Moneyram
Mantra
Take Early Action for Retirement Needs and
EARN your freedom from financial constraints.

₹ You can get a pension even if you are not

a government or private company employee.

Start saving early so that you get many years to

accumulate your retirement wealth and enjoy the effect
of compounding. By doing so, you’ll be comfortable
in your retired life.

Open your NPS account online www.npstrust.org.in/content/open-your-nps-account-online

6
 Chapter 02
Factors to Keep in
Mind
There are some important factors you must
consider for retirement planning, such as
• When do you want to retire?
• How much money will you require after
....your retirement?
• Can you afford to retire early?
• How will you ensure steady flow of
Allow me to elaborate.
....income when you stop working?

1. do
Coming to the first point — when
you want to retire?

Do you want to work for another 10

years? 20 years? 30 years? Or maybe
even beyond that? Remember, one
is expected to live beyond 80 years;
so the earlier you retire, the longer
would be the period for which you
would need a pension.

2. The second point is about — how

much money would you need
every month after retirement?

• This will be based on your day-to-day

expenses for food, clothing and
medicines. The nature of some
expenses that are there currently may
change. For example, school fees may
get replaced with healthcare
.........expenses.

• An important factor to consider

is inflation. Let me explain this with
a simple example. Say, today you buy
1 kg of rice for ₹ 50. In 10 years from
. now, with a 5% inflation, that will cost
you ₹ 75. Imagine the shortfall
in pension if you don't factor inflation
into your retirement planning.

This is what the calculation will look like

at the time of your retirement if you are 30
years old today.

7
 Current age = 30 years If you want the returns to beat
inflation, you should choose
Current expenses = ₹ 10,000 your investments wisely. Understand
a month the risks and returns associated with
various investment options.
Retiring at 60 years and planning
till 80 Say, you invest ₹ 500 every month.
The estimated return on your pension
Inflation = 5%
investment at the end of 30 years will
be different in the case of each type
Value of inflation-accounted
expenses at retirement = ₹ 43,000 of investment.
a month
Fixed return investments such
Monthly shortfall in amount needed as bank fixed deposits are safer
for expenses if not accounting but give lower returns than
for inflation = ₹ 33,000 market-linked investments.

You can clearly see how critical Only investing in fixed return at 6%
understanding inflation is when per annum will give you ₹ 5,00,000.
planning for retirement.
With an investment in equity at 12%
.....per annum, you have a retirement
3. To answer whether you can
afford to retire early, you'll have .....fund of ₹ 17,47,482.
to figure out the amount you need
when you retire. You now know the factors that
influence retirement planning, but how
Continuing with the same example. ....will you get down to actually
....executing it? Continue reading
You are 30 years old for the details.

Your current monthly expenses

are ₹ 10,000

Inflation is 5%

Return on your pension

investment is 10%

You want your savings to last at

least until you are 80

If you work till 60, you need to

contribute ₹ 2,942 a month

But if you are looking to retire at

50, you must save a lot more —
that is, ₹ 6,660 a month.

4. To ensure a steady and adequate flow

of income after your retirement, a key
factor you need to remember is return
on your pension investment.

8
 Building your
retirement plan
Alright, let’s get down to building your
retirement plan. There are a couple
of ways to go about it.

1. First, you need to figure out the

amount you would need to save
for your retirement. Wondering how
to do that? Use a retirement calculator.

• You can decide the monthly

pension you want
• The calculator lets you know how
much to contribute based on your
pension amount
• You can find the retirement
calculator on the link below
www.npstrust.org.in/
content/pension-calculator

This table shows you the amount you need to save each month according to your age
so that you have a big enough fund by the time you retire.

9
2. Next, you have to assess your
current situation.

• Consider how much you can save

at your age with the money that
you currently earn
• Start saving. Don’t worry if the
amount is small. Save more later
when you have the money
• Assess the risks you can take now.
You can choose safe investments
with small rewards or risky ones
that may pay off big

3. Lastly, explore different

pension plans.

• Check if the plan provides a pension

(NPS, insurance and others)
• Check if the plan helps you receive
a guaranteed pension
• Find out which asset classes your
pension plan invests in

Once you've reviewed the different types of plans

available and understood the financial benefits
and risks involved then make your decision. Also,
I am always there to guide. You can contact me,
your PFRDA support, on the call center numbers
1800110708 and 1800110069. You can also
contact us for NPS and APY related queries
on 1800222080 and 18008891030 respectively.

Moneyram
Mantra
Building your retirement plan
begins by understanding how much
you can save based on your
estimated expenses and current age.

Figure out the options you

have for your pension investment.
Understand the risks and
returns for the various options.

10
 Chapter 03
Pension Product Features:
Key Considerations

You now understand the importance of

inflation when planning for retirement.
Your money has to grow faster to out
do inflation.

With so many
products in the
market, it can be
a struggle to decide
which product
is best suited for you.
To help you make an
informed decision, let
me discuss the basics
— I will talk about
financial returns later.

1. investment
First, identify how well your
option is regulated.
2.Second, calculate the cost of
managing your pension plan.

• Regulations ensure that your money • Higher costs mean lower returns —
is invested responsibly remember that.

• Your investments must be handled as • Costs eat into your investment

per product guidelines issued by returns, so try and look for lower-cost
the regulator investments
Third, check how transparent the

11
 pension plan is. 5. Next, know how the plan
has performed since the
3. If the pension plan shows you exactly
what the charges are and how the
beginning and over the past
five to seven years.
pension contribution is invested, making
a decision becomes easy • Returns need to be consistent

• Returns should not be low one year

4. Fourth, find out if the pension plan
offers service delivery and
and high the next year

addresses grievances/complaints.

• There must be a method to look into your

6. And lastly, check out if the pension
plan provides online services.
grievances early and decisively
I don’t need to emphasize the
• It must have a convenient communication importance of online services. You
channel where someone is available know how simple your life is today with
to provide a solution when you need things moving online.

Once you consider these important

factors, the task of choosing the right
pension investment is easy.

Investment options
for retirement
Selecting the right investment option and pension schemes from Insurance
requires a lot of thinking and planning. Companies and Mutual Funds. I have
There could be a lot of confusion as well. listed down the modalities of each for
That’s why I am here. your understanding. Whatever works
best for you is what you should go with.
You can choose from National Pension
System (NPS), Atal Pension Yojana (APY), Take a look at some of the salient
Public Provident Fund (PPF), Mutual Funds features of these plans.

12
 National Atal Pension Public Mutual Pension Schemes
Pension Yojana (APY) Provident Funds from Insurance
System (NPS) Fund (PPF) Companies

Where it Equity/Bonds Equity/Bonds Bonds and Equity/Bonds Equity/Bonds

invests others

Fixed No Pension amount Yes No No

Returns is guaranteed

Investor 0.26-0.3% Not Available Nil 1-2% >5%

Cost

Pros 1. Portable 1. Pre-mature 1.Portable 1. No lock-in 1. Comes along

2. Low cost closure possible, period; exit with life cover
subject to 2.Only lump charges will
3. Tax benefits can conditions sum benefit be levied 2. Tax benefit
be availed of for under Section
contributions made 2 Fixed amount 3.Fixed Return 2. Variety of 80C
under Section 80C of pension schemes to
and an exclusive based on 4.Tax benefit choose from
₹ 50,000 under contribution under Section
Section 80CCD (1B) 80C 3. Tax benefit
4. Lump sum + 3. Tax benefits for under Section
regular pension contributions 5.Pre-mature 80C
5. Withdrawals under Section closure
are possible, 80 CCD (1B) possible,
subject to subject to
conditions conditions
6. Premature
closure possible
7. Withdrawals are
tax free

8. No GST when
you purchase
annuity

1. Minimum
Cons 1. Minimum Lock-in 1. No investment
Lock-in
1. Too many High cost,
period of 5 years; choice funds to thus reducing
period of
with exit charges choose investor returns
5 years; with
from
exit charges
2. Funds have
2. Cap on to be
maximum monitored
investment
and returns

The pension advantage

When you retire, you may have Remember, one is expected to live
accumulated a sizable fund in place (it may beyond 20 years after reaching 60.
seem like a BIG sum of money) but you A regular retirement income, on the
could still be in a dilemma. Should you other hand, is more predictable and
keep it as a lump sum or convert it into helps manage monthly budgets more
periodic payment that replaces your easily. It closely mimics the regular
paycheck? paycheck during employment years.

A lump sum would help you to pay off your Take a look at the comparison here
debts, spend on your family or go on to understand the benefits of a pension
a holiday. However, several global studies over a lump sum payment.
show that the lump sum ‘retirement pot’
melts rather quickly, sometimes as early
as only five years from retirement.

13
 Pension/Annuity Lump Sum Payments
Guaranteed regular payouts No regular payouts

Better sense of Greater flexibility in withdrawals;

financial security requires you to have
greater responsibility as well

Higher likelihood of expenses getting managed Higher chances of overspending

Guaranteed payments throughout High likelihood of exhausting the

your lifetime money before you realize

Can help you plan savings even Requires a lot of detailed financial knowledge
during your retirement and constant monitoring to ensure that one
is able to get a sustained income

So, what’s next?

We have discussed several types of plans, however you need to understand two
in greater detail — National Pension System and Atal Pension Yojana. These, I’m sure, will
meet the expectations of a majority of people.
But before we move to the next chapter on NPS and APY, I want to throw light on some
precautionary measures that you all must take from today itself.

Plan ahead to get a regular pension and • Do not agree to receive money in your
stay financially healthy account from a stranger
• Keep a check on your expenses • Do not give access to your phone/
• Avoid taking loans for consumption, computer to anybody
.....lifestyle and expenses • Be careful of KYC messages — only
• Keep your financial documents deal with your bank/financial
in order .....institution branch directly or go to
• Always update nominee details .....their website
Be alert to scams
• Do not share any financial information
with strangers
• Do not give your debit card and
its details to others
• Be extra careful with digital
transactions

Moneyram
Mantra
Key factors to be considered before National Pension System
investing — cost, transparency, and Atal Pension Yojana
regulations and service levels. will meet the expectations
of a majority of people.
Pensions offer regular payouts
unlike lump sum payments.
14
 Chapter 04
The Magic of National Pension System
Alright folks, are you ready for That’s not all! NPS gives you the
our superstar when it comes flexibility to invest any time during the
to pension planning? year. This makes you eligible for tax
deductions which is also tax-efficient
Presenting to you, National at withdrawal
Pension System (NPS).
NPS is a scheme that allows you Let’s dive deeper into the benefits
to contribute money into an individual of this unique pension plan.
pension account. It allows you to deposit
money into this account throughout your
working life and enjoy it after retirement.

Simplicity
Open an NPS account through
a simple process and receive your Easy access
Permanent Retirement Account Start your NPS account through
Number (PRAN). e-NPS or through any PoPs and also
make online contributions to your
Flexibility in contribution account using the platform.
NPS allows you the freedom to
contribute any amount at any time
during the year (minimum ₹ 500 per Tax efficiency
contribution; the total contribution Your contributions are eligible
per year must be ₹ 1000 and more). for tax deductions. Refer
to section “Taxation Under NPS”
Investment freedom for further details.
NPS allows you to choose between
various pension investment options, Sustainability
so you can plan your retirement the You can stop worrying about your
way you want. Refer to section regular income as NPS provides
“Investment Options Under NPS” a regular stream of pension
in this chapter for further details. payments (they could be fixed
or variable depending upon the type
Portability of pension you have chosen).
Once you open an NPS account,
it stays with you forever — whether
you change your city or job Well-Regulated
if working. NPS is regulated by the Pension Fund
Regulatory & Development Authority
Low cost (PFRDA) which provides transparent
NPS is one of the lowest costing pension investment norms, regular
pension plans in India. It allows you monitoring and performance review
to increase your retirement fund of funds managed by the NPS Trust.
through long-term savings and
investments that give you returns
to beat inflation.

15
NPS
Investment options
under NPS
Now, let’s take a closer look at the
investment options available under NPS.
You can opt for Active Choice, Auto
Choice or others.

What is Active Choice?

If you are an individual who understands
the investment market well, you are likely
to opt for this choice. As the name
suggests, this option allows you to actively
make decisions about how your
contribution is to be invested in the asset
classes of Equity (E), Corporate Debt (C),
Government Securities (G) and Alternative
Assets (A).

What is Auto Choice?

If you are an individual who wants
to keep it simpler and have your fund
manager manage your investments,
Auto Choice is the option for you. It
spreads your investment across different
asset classes by dynamically allocating
funds based on how old you are. The
three asset classes available within Auto
Choice are Aggressive, Moderate
and Conservative.

Change of Scheme and Pension

Fund Manager
Subscriber has a choice to switch
between Auto and Active schemes four
times in a financial year. Pension Fund
Managers can also be changed once
in a year.

16
 Let’s take a look at these asset classes
in detail.
Aggressive Life Cycle Fund Moderate Life Cycle
This fund limits your Equity Investment The exposure in Equity Investments
to 75% of your total assets. As you age, is 50% of your total assets until 35 years
your exposure in Equity Investments and it decreases as you grow old.
gradually reduces. Take a look.
Check out how your contribution will be
allocated among three asset classes as per
your age under Aggressive Life Cycle Fund.
Asset Asset Asset
Age (years)
Asset Asset Asset Class E Class C Class G
Age (years)
Class E Class C Class G
Up to 35 50 30 20
Up to 35 75 10 15 36 48 29 23
36 71 11 18 37 46 28 26
37 67 12 21 38 44 27 29
38 63 13 24 39 42 26 32
39 59 14 27 40 40 25 35
40 55 15 30 41 38 24 38
41 51 16 33 42 36 23 41
42 47 17 36 43 34 22 44
43 43 18 39 44 32 21 47
44 39 19 42 45 30 20 50
45 35 20 45 46 28 19 53
46 32 20 48 47 26 18 56
47 29 20 51 48 24 17 59
48 26 20 54 49 22 16 62
49 23 20 57 50 20 15 65
50 20 20 60 51 18 14 68
51 19 18 63 52 16 13 71
52 18 16 66 53 14 12 74
53 17 14 69 54 12 11 77
54 16 12 72 55 & above 10 10 8
55 & above 15 10 75

Taxation under NPS Taxation under NPS

on withdrawals or exit on purchase of
You are entitled to annuity/pension
tax-free withdrawals Amount invested for
for partial/lump purchase of annuity
sum/occurrence of death, is tax-free
subject to conditions Regular pension/annuity
mentioned earlier in the is taxable, like any other
withdrawals-exit section. income, on the basis of
your individual tax bracket

17
Conservative Life Cycle Fund
This fund limits the allocation into Equity
to the extent of 25% of the total assets
till you’re 35 years and gradually reduces Taxation benefits
with age.
This example will explain better. NPS offers various tax advantages
to individuals and corporate employees
on contributions and withdrawals or exit.
I have captured these aspects below.
Asset Asset Asset
Age (years)
Class E Class C Class G

Up to 35 25 45 30
Taxation under NPS on
36 24 43 33 contributions
37 23 41 36 Tax benefits for individuals
38 22 39 39 You can avail of tax benefits under Section
39 21 37
....80 CCD (1A) for NPS contribution with
42
a ceiling of ₹ 1.5 lakh under Section 80 CCE*.
40 20 35 45
41 19 33 An additional deduction for investment
48
upto ₹ 50,000 in NPS (Tier I account)
42 18 31 51 is exclusively available to NPS subscribers
43 17 29 54 ....under Section 80 CCD (1B).
44 16 27 57 *As per Section 80 CCE, the overall amount of tax deductions under Section
80 C, Section 80 CCC and subsection (1) of Section 80 CCD shall not, in any
45 15 25 case, exceed ₹ 1.5 lakh.
60
46 14 23 63
Tax benefit for corporate employees
47 13 21 66
48 12 19 69 Corporate employees are able to claim
49 11 17
additional tax benefits on their contribution
72
up to 10% of salary under Section 80 CCD (2).
50 10 15 75 This is over and above the limits mentioned
51 9 13 under sections 80 CCD (1A) and 80 CCD (1B)
78
(subject to overall limit of ₹ 7.5 lakh for all
52 8 11 81 investment schemes).
53 7 9 84
54 6 7 87
55 & above 5 5 9

How to open your NPS account?

Okay, so it’s now time to open your NPS account. Want to know how? There are two ways
to go about it.
You can open your NPS account both, Offline
online or offline — the choice is yours. PFRDA appoints Point of Presence
(POP) entities to help you. NPS
account opening forms can
Online be collected from POPs and
Your NPS account can be opened submitted to them along with
online using eNPS platform relevant documents. You can also
www.npstrust.org.in/ make contributions via POPs.
content/open-your-nps-account- If you are a central, state
online. It's quick and easy; you can or private company employee,
make contributions via your bank approach your HR department
account, credit card or debit card. for NPS enrolment. Most PoPs
now give you the online option
for opening an account.
18
 Exit (before 60 years/date of
Withdrawal/Exit retirement)
In the case of premature exit, at least
One of the many advantages of NPS 80% of your accumulated fund has to
is that it allows you to access your be used to purchase an annuity to
funds to deal with personal exigencies. provide a regular pension. The
remaining 20% can be taken as a
Let’s see how?
lump sum.
Allowed on completion of minimum five
years of account opening under NPS.
Exit If accumulation is less than ₹ 2.5 lakh, it
You can completely exit from NPS will be paid fully in a lump sum
and terminate your subscription on retirement.
under the following circumstances. Deferment Option
In case of premature exit, you do not get the
choice to defer your pension or lump sum
withdrawal.

On retirement
When you turn 60 years old, you can opt
up to 60% withdrawal in lump sum and
Exit (joining after 60 years)
use the remaining 40% (mandatory Before completion of 3 years
annuitisation) for a regular pension. Annuitisation = minimum 80%
Lump sum withdrawal = maximum 20%
Exit (joining 18-60) If corpus is less than ₹ 2.5 lakh, complete
withdrawal is permitted
Before 60 years or superannuation
(subject to completion of 5 years)
On completing 3 years and up to 75 years
Annuitisation = minimum 80%
Annuitisation = minimum 40%
Lump sum withdrawal = maximum 20%
Lump sum withdrawal = maximum 60%
If corpus is less than ₹ 2.5 lakh, complete
If corpus is less than ₹ 5 lakh, complete
withdrawal is permitted
withdrawal is permitted
Death due to any cause
On attaining 60 years and up to 75 years Nominee can withdraw 100% of pension
Annuitisation = minimum 40% wealth in lump sum
Lump sum withdrawal = maximum 60% Nominee can also opt to buy annuity using
If corpus is less than ₹ 5 lakh, complete corpus
withdrawal is permitted Deferment Option
Option for continuance up to 75 years Upon retirement, you can choose to defer your pension
and lump sum withdrawal up to 75 years.
Lump sum deferment till the age of 75
and option to withdraw in annual
installments. Annuity purchase deferment
till the age of 75
Death due to any cause
Nominee can withdraw 100% of pension
wealth in lump sum
Nominee can also opt to buy annuity
using corpus

19
 Partial
Withdrawals
Partial withdrawals are possible three
times during your subscription tenure
under the circumstances listed here.

Children's higher
education or
their marriage
Purchase or
construction of a
house in your
own name

Hospitalization
needs for you
and your
loved ones
Completion of
at least 3 years
of subscription
to NPS
Each withdrawal
not to exceed 25%
of your own
contribution

Disability of
more than 75%

Treatment of any
specified illness

Skill development/re-skilling
or any other self
development activities
Establishment of
your own venture
or any startup

Just keep in mind folks, withdrawals are only allowed for a maximum of three 20
times during your subscription’s tenure.
 Making a nomination Here’s how you can choose
your nominees

Say, you’ve invested a lot of money Choose up to three nominees.

01
to take care of all your needs after For appointing a minor, the
retirement. What do you think will date of birth and guardian
happen to that accumulated pension details are required
wealth in the event of an unfortunate
demise before or after retirement?
02 Nominate by sending a request
Don’t worry, NPS also allows you
to name nominees to receive form to POP or submit online
your retirement money. if registered through eNPS.
Nominee details can
be changed later online

Mobile app and online services

I understand that all this may seem overwhelming,
which is why NPS offers a user-friendly mobile app
too to make life easy.

NPS mobile app benefits

Request withdrawal of
money from your Tier II**
account easily

Access your NPS account

through the mobile app
provided by your CRA
Search and edit your profile
details such as registered
mobile number and email id

Check your Tier I* and Tier

II** funds besides your last
five transaction details

Request account statements

for specific period

*Tier I is for your pension savings; with

tax advantages
**Tier II is for your additional investment
savings if you wish to do so; no
restriction on withdrawals (tax benefits
applicable for government
employees only)

21
Let’s now go over the benefits of NPS
online services, either using the website Make changes to your
portal of your Central Recordkeeping plan preference
Agency (CRA) if registered through
eNPS or website portal of POP
Make initial and subsequent
if registered through a POP.
contributions to your Tier I
Open your pension account under and Tier II accounts
NPS (both Tier I and Tier II)
Click here to open your NPS account View your account
online : details/transaction statement
Fenps.nsdl.com/eNPS/OnlineSubscri
berRegistration.html?appType=main Request a withdrawal from
your Tier II account using the
Update your personal details such online services
as e-mail id and mobile number

Central Record Keeping Agency (CRA)

In case you’re wondering how to check
the performance of your investments NPS is really a wonder with all the
in NPS, you can do that by logging benefits it provides. It also allows you
in to your NPS account using the login id to raise grievances/complaints in many
and password provided along with your ways. Take a look.
PRAN Kit.
Physical Forms directed to CRA
Submit your grievance in
a prescribed format to POP service
providers for forwarding to CRA
of Central Grievance Management
System (CGMS)

Call Centre/Interactive Web-Based interface

Voice Response Register your
grievances/complaints by using
System (IVR) the Tele-query Personal
Contact the PFRDA call centre Identification Number (T-PIN)
on the toll-free number at the CRA call center with the
1800-110-708 toll-free number (022) 24993499.
You may also register using your
Internet Personal Identification
Number (I-PIN) by visiting
www.npscra.nsdl.co.in.

GRIEVANCE
BOX

CRA Portability: Easily switch between CRAs, if required, either due to change in the subscription
type, that is from All Citizen to Corporate model and vice-versa.
22
 Annuities
I have mentioned this word a couple of period of time in exchange for a lump
times, but do you know what it actually sum. By annuitizing your savings, you
means? Let me tell you. can exchange them for periodic
payments that will last till your lifetime.
Annuities are products designed to
provide regular payments over a future

There are many types of annuities with varied benefits.

01 Annuity/pension 02 Annuity payable for 5, 03 Annuity for life with

payable for life at a 10, 15 or 20 years return of purchase
uniform rate. certain and thereafter price on death
as long as the annuitant of the annuitant.
is alive.

04 Annuity payable for 05 Provision of 50% of 06 Provision of 100% of

life increases at a the annuity payable the annuity payable
simple rate of 3% p.a. to spouse during to spouse during
their lifetime upon their lifetime upon
your death. your death.

07 Provision of 100%
annuity payable to
spouse during their
lifetime; the purchase
price is returned on the
death of the last
survivor.

23
Moneyram
Mantra
There are two NPS investment options you can
choose from — Active Choice and Auto Choice.

NPS offers several tax benefits for individuals and

corporate employees.

An annuity in NPS is a type of investment that offers

regular payments for stipulated time
or life.

24
 Chapter 05
The Power of Atal Pension Yojana
Did you know that many people who With the benefits APY provides
work in the unorganized sector of India and the difference it makes in people's
aren’t aware that there is a pension plan life, retirement life can spell peace and
even for them? happiness.

That’s the next superstar I want to talk Check it out.

to you about — and that is Atal Pension
Yojana (APY).

APY is a government-sponsored plan

that provides a guaranteed monthly
₹ pension.

The available monthly pension slabs

under the scheme are ₹ 1000, 2000,
3000, 4000 and ₹ 5000. ₹ ₹ ₹
1000 2000

3000
+
Contributions are based on the pension
amount selected and the age of the
₹ subscriber at the time of joining the scheme.

Its purpose is to provide a regular

monthly pension to anyone and everyone
with a formal pension provision and help
them meet expenses.

If you are between 18 and 40 years, you

can join APY. The earlier you start, the
more peaceful your retirement will be.
₹

25
Just like NPS, there are two ways
you can go about opening your APY
account — offline and online.

1. Offline

• Visit the bank in which you have a

savings account

• Submit the APY application form

and complete the KYC process

• Keep useful documents such as

your Aadhar Card handy
₹
2. Online
• Maintain a balance in your savings
The Net banking facility of your bank allows account on the due dates to avoid
you to open an APY account quickly and paying a late fee
easily. Click here to register your APY
account online. • You can choose to increase or
enps.nsdl.com/eNPS/ApySubRegistration decrease your pension amount in
.html the accumulation phase in April
every year

Let me quickly tell you how to operate your • You need to submit a request at
APY account. age of 60 for your guaranteed
monthly pension
• You can contribute to your APY
account by setting up an • Canceling the plan is not
auto-debit facility with the bank permitted before you reach 60,
with the exception of death or
terminal illness

3.eAPY
It also benefits POP-SPs.
PFRDA has now introduced a digital mode
for opening your APY account. Take a look
• Additional mode of sourcing
at the various benefits subscribers get
• No manual interventions — dataflow is
through eAPY.
in electronic form
• Increased penetration with the ability
• Completely digital solution
to reach subscribers across
• 24/7 enrolment from the comfort of
geographies
your home/office; no need to visit
• Less time and effort
bank branches
• No requirement of physical storage
• No submission of physical
of forms
application form
• Lead generation module to facilitate
• Save time, effort and cost
more enrolments

26
 The table here shows how an APY account functions depending on age, time of joining
and monthly contribution amount.

Expected
Monthly ₹ 1,000 ₹ 2,000 ₹ 3,000 ₹ 4,000 ₹ 5,000
Pension

Return of
corpus to ₹ 1.7 lakh ₹ 3.4 lakh ₹ 5.1 lakh ₹ 6.8 lakh ₹ 8.5 lakh
the nominee

Age of Indicative Indicative Indicative Indicative Indicative

joining Years of Monthly Monthly Monthly Monthly Monthly
contribution Contribution Contribution Contribution Contribution Contribution
(in years) (in ₹) (in ₹) (in ₹) (in ₹) (in ₹)

18 42 42 84 126 168 210

19 41 46 92 138 183 228

20 40 50 100 150 198 248

21 39 54 108 162 215 269

22 38 59 117 177 234 292

23 37 64 127 192 254 318

24 36 70 139 208 277 346

25 35 76 151 226 301 376

26 34 82 164 246 327 409

27 33 90 178 268 356 446

28 32 97 194 292 388 485

29 31 106 212 318 423 529

30 30 116 231 347 462 577

31 29 126 252 379 504 630

32 28 138 276 414 551 689

33 27 151 302 453 602 752

34 26 165 330 495 659 824

35 25 181 362 543 722 902

36 24 198 396 594 792 990

37 23 218 436 654 870 1087

38 22 240 480 720 957 1196

39 21 264 528 792 1054 1318

40 20 291 582 873 1164 1454

27
I suppose you are already convinced about the power of APY, but I would still
like to give you more details. Information is power, so it's always good to equip
yourself with more of it.

1. Upon death of • Upon death, 100% of your pension will be

...subscriber payable to your spouse. After your spouse’s
death, the amount used for purchase of annuity
to provide for this pension will go to
your nominees.
• Your spouse has the option to maintain the APY
account or close it and receive the contributions
made by you as well as any gains earned.

2. Retirement benefits

The main advantage of APY is that the

monthly pension payable after 60 years of
age is guaranteed by the government. The
monthly pension depends on the amount
you've contributed.

3. Tax benefits

Tax benefits can be availed of for

contribution made under Section 80C.

Moneyram
Mantra
₹
APY provides a government-guaranteed
pension depending upon how much you contribute
and the pension amount chosen.

Join the APY scheme if you are aged

between 18-40 yrs.

APY offers three guaranteed benefits.

28
 Afterword
I hope you have enjoyed reading this booklet. NPS and APY are your two trusted plans
I would like to think that it is both when it comes to planning your retirement.
comprehensive and engaging. It provides You can choose from a variety of pension
you with all the information you need about plans to make sure you enjoy your retired
retirement planning, saving for the future, life. So, what are you waiting for? Get started
NPS, APY and the many benefits they offer. now. Before I leave, a reminder that you can
always contact me on 011-26517501-03.
As a parting thought, I want to remind you
of the importance of planning for your
retirement. No matter how young or old you
are, start soon and reap the benefits later.

Remember, don't simply

retire from your job, plan
for your retirement. Avail
of benefits with schemes
such as NPS and APY.

PFRDA never makes calls to individuals requesting them to deposit money for release of funds from
29 NPS/PFRDA. Any such communication received to defraud may be informed to police immediately.
Glossary of Terms
A N
Asset National Pension System
Any resource that holds economic value for its owner. It could National Pension System (NPS) is a retirement savings
be in the form of cash, inventories, securities, or real estate program that provides an adequate retirement income
to everyone. It helps people build a nest egg for the future
Annuity
This is a contract made by an insurance company to make
regular payments to a customer for a period chosen at the P
time of buying annuity. Point of Presence
Point of Presence are distribution channels which provide
Asset Allocation services to subscribers/potential subscribers under NPS
The division of an investment portfolio among the different through their network of branches called POP Service Providers
asset categories
Pension
Annuitant A regular sum of money paid by the state or a former
A person who receives an annuity employer to a person after retirement

Atal Pension Yojana Payout

Atal Pension Yojana (APY) is a regular contribution-based A large sum of money paid to someone as compensation
pension plan that promises a guaranteed pension or dividend
of ₹ 1,000/2,000/3,000/4,000/5,000. The pension starts at
the age of 60 Partial Withdrawal
Any part of a fund that is encashed/withdrawn by the
policyholder during the term of a policy
B
Bond
Bond is a debt instrument in which an investor loans R
money to an entity which borrows the fund for a defined Regulatory Body
period of time at a variable or fixed interest rate A public organization or government agency that is
responsible for legally overlooking aspects of human activity
C
Corpus Return on Investment
The total money invested in a particular scheme by all Return on Investment (ROI) is a metric used to evaluate the
investors

Compounding Risks
The ability of an asset to generate earnings which are then
re- invested to further generate earnings be different and may be subject to losses

E S
Equities S2 Form
Real estate and common stock are examples of equities where This form is to be used for the purpose of change/correction
investors get a certain portion of the ownership in subscriber personal details, nominee details, reissue
of I-Pin/T-Pin, or reissue of PRAN card

H Service Provider
Health Insurance
A contract where an insurance company provides medical
coverage against medical expenses administration

Superannuation
I Money that people pay towards a fund while they are working
Inflation so that they will receive payment when they stop working
The loss of purchasing power due to a general rise in the in their old age
prices of goods and services
T
Tier-1 NPS Account
L The most basic form of NPS accounts. Investors can invest
Lump Sum as low as ₹ 1,000 a year in these accounts

in one single payment

Tax Benefit
Lifecycle Fund A reduction in the amount of tax that a person or organization
A mutual fund that maintains an asset allocation based on the would normally have to pay in a particular situation
expected retirement age of the investor

Loan V
Valuation
that is expected to be paid back with interest Valuation is a calculation that measures the current worth
of an asset

M
Market-Linked Investments
They are debt securities or bonds that have a return linked
to the performance of another asset

30