The National Pension System (NPS) is a government-sponsored retirement planning instrument, which gives the investor the option to set a preferred allocation to various asset classes, such as government bonds, equity market instruments, and corporate debt.
It is a long-term investment plan for retirement. The NSDL (National Securities Depository Limited) is the central record keeping agency for the national pension system. As part of the system, each employee is identified by a unique number and has a separate Permanent Retirement Account Number (PRAN). (Also Read: Assets Under Management Under NPS, Atal Pension Yojana Cross ₹ 6 Lakh Crore )
National Pension System (NPS): Key Things To Know-
How to open NPS account:
An NPS account can be opened by a citizen of 18-65 years of age, according to the National Securities Depository's (NSDL). The account can be opened through the online or offline mode.
The subscriber can either apply for an NPS account by visiting a Point of Presence (PoP), or do it online through the e-NPS website- enps.nsdl.com/eNPS, according to NSDL.
Types of NPS accounts:
NPS offers two types of accounts: Tier 1 and Tier 2. The tier 1 NPS account is a pension account which does not allow withdrawals. Whereas, tier 2 NPS account - known as an investment account - is a voluntary saving account associated with the PRAN. Tier II offers a greater flexibility in terms of withdrawal, according to the NSDL.
In an NPS account, the subscriber is allowed to check the investment amount or balance on a day to day basis. Central government subscribers have the option of selecting the pension funds (PFs) and the investment pattern in tier I account.