By: Abhishek Rana
Published 14 June 2024
When subscribing to the NPS (National Pension Scheme), you are given two options: Auto (which is the default option) and Active. In the next couple of slides, let’s first understand what they are.
It automatically invests your money between equity and debt. With each passing year, NPS reduces your equity allocation and increases your investment in debt.
If you choose the ‘Active’ option, NPS gives you the freedom to choose your equity-debt allocation.
You can only allocate up to 75% of your money in equity. There is no such restriction, though, when it comes to debt; you can invest 100% of your money in it.
You need to look at their long-term performance. When we did, Active proved to be a better choice. But should you opt for it? Read the full story to get your answer.