The Pension Fund Regulatory and Development Authority (PFRDA), apart from easing National Pension System (NPS) exit guidelines, has permitted subscribers, who be part of it after the age of 65 years, to allocate as much as 50% of the funds in fairness.
The Pfrda in a round stated that in response to the big variety of requests from the present subscribers to stay invested in NPS past 60 years or past their superannuation, and the will from residents above 65 years to open NPS, it has been determined to extend the entry age of NPS within the curiosity of subscribers and profit them with the chance of making a long run sustainable pension wealth. “The existing age of entry which is 18-65 years has been revised to 18-70 years,” PFRDA stated.
“Any Indian Citizen, resident or non-resident and Overseas Citizen of India (OCI) between the age of 65-70 years can be part of NPS and proceed or defer their NPS Account as much as the age of 75 years. Those subscribers who’ve closed their NPS accounts are permitted to open a brand new NPS account as per elevated age eligibility norms,” PFRDA stated.
The options and advantages of elevated age of entry are as talked about under:
Choice of Pension Fund and Asset Allocation
The subscriber, becoming a member of NPS past the age of 65 years, can train the selection of PF and asset allocation with the utmost fairness publicity of 15% and 50% beneath auto and energetic alternative respectively. The PF might be modified as soon as per 12 months whereas the asset allocation might be modified twice.
Exit and withdrawals
The exit situations for subscribers becoming a member of NPS past the age of 65 years can be as beneath:
> Normal exit shall be after 3 years. The subscriber can be required to make the most of at the very least 40% of the corpus for buy of annuity and the remaining quantity might be withdrawn as lump sum. However, if the corpus is the same as or lower than ₹5.00 lakh, the subscriber might choose to withdraw the complete amassed pension wealth in lump sum.
> Exit earlier than completion of three years shall be handled as untimely exit. Under pre-mature exit, the subscriber is required to make the most of at the very least 80% of the corpus for buy of annuity and the remaining might be withdrawn in lump sum. However, if the corpus is the same as or lower than ₹2.5 lakh, the subscriber might choose to withdraw the complete amassed pension wealth in lump sum.
> In case of unlucky dying of the subscriber, the complete corpus can be paid to the nominee of the subscriber as lump sum.
The subscribers are additionally eligible to open Tier II account for investing their disposable revenue to optimize their returns which not like Tier-I account might be withdrawn at any time.
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