National Pension Scheme: Planning for retirement ahead of time will help ensure that you don’t have financial stress when you are older. The National Pension System, or NPS, is one of the several retirement fund-accumulation programmes available.
Returns Based on Market
The account holder receives returns based on the market in this. There are two methods to invest money in NPS. Retirement accounts make up Tier 1 and voluntary accounts make up Tier 2. After reaching 60 years old, you can withdraw 60% of the total money deposited in NPS as a lump sum, with 40% being used as an annuity.
You can set up a large fund and pension for your later years in this way using NPS. Your account may be frozen if you make a mistake when contributing to this scheme, which offers double benefits. The frozen account can be reactivated, though. Learn the reasons behind NPS account inactivity as well as how to bring an inactive account back to life.
How will the account go back into action?
- A frozen account must be reactivated by filling out the UOS-S10-A form. This form is obtained from the post office. Alternatively, you can use this form to enter your current NPS.
- The form is also available for online download. You must click on a link to do this. The file is called UoS-S10A-Unfreezing%20of%20PRAN.pdf. The link is https://npscra.nsdl.co.in/download/non-government-sector/all-citizens-of-India.pdf.
- The form must also have a copy of the subscriber’s PAN card attached. In addition, the subscriber must pay a penalty of Rs 100 and deposit the remaining annual contribution amount into the account.
- The office staff verifies your account when you submit the application. Following this, PRAN is activated and your application is processed.
Tier 1 Account Prerequisite
It is required to open a Tier 1 account in order to subscribe to NPS. The individual can then open a Tier 2 account if he so chooses. You must deposit Rs. 1000 in Tier 2 and Rs. 500 in Tier 1 when creating an account. After that, yearly deposits of at least Rs. 500 in Tier 1 and Rs. 250 in Tier 2 are required. The maximum contribution has no upper limit. Your NPS account can be blocked or cancelled if you fail to deposit the required minimum each year.
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