A certain part of the corpus should to be kept aside for annuity in National Pension Scheme (NPS). How does annuity work? Where and how this money is invested/utilized?
- Vikrant Vala
If you are getting out of National Pension Scheme (NPS) before you are 60 years, you should invest at least 80 per cent of the corpus to purchase an annuity from a life insurance company. If you are getting out of NPS after you are 60 years, you need to invest a minimum 40 percent of your accumulated savings to purchase a life annuity from a life insurance company.The life insurance companies offer a variety of annuity options and the rate of annuity would depend on your choice of annuity. The insurance companies do not disclose where they invest the money.
This article was originally published on January 06, 2016.
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