NPS,a must for the government employees for their retirement income flow has been day in and day out tweaked by the regulator in view of the life expectancy as well as market conditions.
At a time when interest across fixed income instruments has seen a southward trajectory, investors in order to get moderate returns are not shying away from taking some risk. So, other than mutual funds, those in their older age for whom PFRDA has changed its eligibility conditions can also bet upon NPS to recoup good gains as the product provides market based returns. A maximum of 75% of the subscriber's funds can be diverted to equity.
So, if you haven't till now invested in NPS, the time is right even if you have surpassed the age of 60 years with the new ruling, The NPS account is further dividend into accounts which can also be opened by a non-resident.
NPS Tier I a/c under which the contribution to the extent of Rs. 6000 in a year has to be made mandatorily and also in respect of the withdrawal conditions, the account has a lock-in period of 10 years. With different assets to its portfolio, you gain substantially over and above the returns from the fixed instruments. Also, tax benefits to the extent of Rs. 1.5 lakh are available under section 80C
In respect of the other NPS tier II account which is not mandatory, there have been reports of returns to the extent of 11.5%- 14% which are way higher. Also, there is no specific conditions with respect to withdrawal laid down for the account and the subscriber can redeem funds from the scheme at anytime.