More flexibility in NPS withdrawal

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More flexibility in NPS withdrawal
In a aim to provide more flexibility to National Pension System (NPS) subscribers, the Pension Fund Regulatory and Development Authority (PFRDA) has introduced deferred withdrawal for the NPS.

In this option the subscribers would be given a specific option to defer or time the entire lump sum withdrawal (max 60%) at the time of exit from National Pension System (NPS) rather than forcing them to choose a certain percentage (%) each and every year while choosing the existing ‘Phased withdrawal' option, including the year in which they are exiting the system.

Under the Deferred withdrawal facility, the subscribers at the time of exit from National Pension System (NPS) can exercise an option to defer the withdrawal of eligible lump sum withdrawal and stay invested in the NPS.

However, it may be noted that no fresh contributions are accepted and also no partial withdrawals are allowed during such a period of deferment

The subscriber can withdraw the deferred lump sum amount at any time before attaining the age of 70 years by giving a withdrawal application or notice. If no such notice is given, the accumulated pension wealth would be automatically monetized and credited to his bank account upon attaining the age of 70 years.

Read more about: nps, pension
Story first published: Tuesday, March 26, 2013, 16:40 [IST]
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