National Pension System provides income to every Indian Citizen after retirement. If you are young and planning for retirement scheme then open an NPS account in India. You can open an NPS account either online or offline with banks like ICICI, SBI and HDFC.
National Pension Scheme account Features
NPS saves some money every month or year till you retire from your job. You can open National Pension Scheme account for future income plan. It is government scheme and you can avail tax benefits. Also, you can switch funds as per your financial goals. You can read Big Relief with revision in maximum age entry for NPS
Under this scheme risk is created and your money is invested according to your age. If you are young your money will invested in equity shares to provide high return in long term. On other hand, if you are near to your retirement your money moves to debt to make it secure. NPS allows you to save income tax u/s 80C up to Rs 1.5 lakhs and you will get more tax benefit of Rs 50,000 under section 80CCD (1B).
Steps for NPS account Offline Process
- Opening NPS account in offline is not advisable but still you can open it as below
- You need to fill registration form to open an NPS account and you will get this form from NSDL website.
- Fill your name, address, bank account number, and pension fund and asset allocation
- It is mandatory to submit your KYC documents. If you are opening with bank then KYC is not required.
- To open NPS account Minimum amount is Rs 500 and you need to invest at least Rs 6,000 every year. There will be one-time charge is Rs 125.
- As soon your account is open you will get permanent retirement account number (PRAN). This is unique portable number remains with applicant under NPS.
- You can access your account online with password allotted to you.
Steps for NPS account Online Process
Follow below steps to open an NPS account online
- Go to website enps.nsdl.com
- Click on Registration Tab
- New window will open ‘ Online Subscribers Registration’ Page. You can select New Registration.
- Now you are opening an account as an individual, choose individual subscriber option. If you are subscribing via your organization then choose corporate subscriber.
- You are asked to choose type of account
- If you have Aadhaar Card select Aadhaar or you can also select PAN.
- If you have selected Aadhar Card and enter Aadhaar number you will receive OTP on your mobile number.
- If you have select PAN then you can select bank in which you hold savings account. Your bank will verify your KYC details. For verification bank will charge one-time fee of Rs 125 from your account.
- It is important to note that your name and address match with your records. This is essential for KYC verification.
- You will receive your slip and you must keep this slip as acknowledgment number is used in future to access application.
- Now give your bank details to receive NPS maturity amount in future.
- Choose fund manager under nomination details.
- Next you choose mode of investment. There are two modes of investment auto mode and active mode. In Auto mode equity allocation of money will decrease with your increasing age. This will work automatically and you do not need any manual. In active mode you need to fix an asset allocation as per your choice.
- If you are choosing more than one nominee you need to mention each nominee details in form.
- Upload your photograph and signature
- Enter your contribution to Tier I and Tier II. But minimum amount for Tier I is Rs 500, and for Tier II its Rs 1000.
- Then you will direct to payment charges.
- Once you make payment your Permanent Retirement Account Number (PRAN) will become active.
- Tier I is mandatory account for long-term savings. Invest in Tier I account to avail Tax benefit up to Rs.50, 000 u/s 80CCD (1B).
- Tier II is an add-on account and it provides option to invest and withdraw from various schemes available in NPS without any exit load.
- Government employees who are covered under NPS can go to Nodal Offices for PRAN generation.
You can check rules for NPS withdrawal. You can see Pros and Cons of NPS and comparison of NPS with other investment options. If you face any difficulty to open NPS account you may call NPS helpline number 1800110708. Thus check Investment planning for Retired people