Managed by the Pension Fund Regulatory and Development Authority (PFRDA), the National Pension System is a voluntary and defined retirement savings scheme that offers Tier-I and Tier-II investment options for post-retirement. It is an initiative by the Government of India aimed at providing retirement support to Indian citizens from organised and unorganised sectors, along with tax benefits and easy withdrawal.
By this system, reasonable contributions made by the employee over the course of his/her career accumulates until retirement. Employees also have the option of opting out of the NPS scheme before retirement or choosing superannuation. However, NPS ensures that a good portion of the funds are used for retirement benefits in any case.There are two investment options under NPS and a fund manager creates a portfolio based on the choice:
- Auto Choice: Funds are automatically managed by a fund manager according to the investor’s age bracket
- Active Choice: Investors have a choice of Asset Classes and can allocate funds across assets up to a certain amount
Enrollment and contributions towards the NPS need to be timely and consistent so as to gain maximum profitability upon retirement. Eureka Stock and Share Broking Services Ltd. knows the process inside and out and can assist with all formalities, asset allocation, and fund management, based on your choice of investment.