Retirement is a long, long time away, right? Why take tension about it from now? Most people have a "dekha jayega" attitude towards their retirement and more often than not, it hurts their chances of living in comfortable ease in the sunset age. To make sure that doesn't happen with you, to make sure you're tension-free in your retirement, what you need is a regular pension. And you can plan for that from now by using the National Pension System (NPS). Here are the whys and the hows:
Complete safety and lowest costs
The NPS is backed by the Indian government and offers total capital protection. It is also lowest cost pension system available today to all Indian citizens, irrespective of what they earn or what work they do. The scheme offers withdrawal options as well.
Regular investments and tax saving
You can invest in the NPS on a monthly or quarterly basis, depending upon your convenience. The investments you make in it are eligible for tax deduction under section 80C. Furthermore, additional investments in the NPS to the tune of ₹ 50,000 can be used to get further tax breaks over and above the 80C entitlement as well.
Ability to beat inflation
While the NPS doesn't guarantee returns, it gives investors the opportunity to beat inflation over the long-term. The NPS offers different plan options that offer exposure to exposure to equity instruments, corporate debt, fixed income instruments and government securities. The risk you choose would depend on your profile, but the ability to have equity as an investment component means you will earn inflation-beating returns.
Facility to switch funds
The NPS allows investors to move from one fund to another or change fund managers if they're not satisfied with how their investment is doing. This offers further flexibility to make sure your long-term returns keep improving.
This article was originally published on January 11, 2016.
Ask Value Research 
New episodes every Friday 
New Process Alert 
Seems like you've uploaded a wrong QR code. Please upload the QR code downloaded from MF Central platform.
