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NPS

National Pension System (NPS)

NPS (National Pension System) is a government-backed, long-term, tax-efficient retirement savings scheme aimed at helping individuals accumulate a retirement corpus. It offers to invest in a variety of asset classes like equities, bonds, and government securities. Managed by the NPS Trust and regulated by the Government of India, it ensures secure pension benefits upon retirement. .

Features

  • Tax Benefits: Contributions qualify for tax deductions under Section 80C (up to ₹1.5 lakh) and additional benefits under Section 80CCD(1B). Invest in Tier 1 for tax savings and Tier 2 for flexibility, though Tier 2 doesn’t have the same tax benefits.
  • Low-Cost Investment: The NPS has one of the lowest expense ratios among investment options.
  • Government Backed: Being government-run, it provides a degree of security and stability.
  • Diversification: It invests in equities, bonds, and government securities. 
  • Lock-in Period: You can only withdraw the corpus at retirement age (60), though partial withdrawals are allowed under certain conditions.
  • Market Risk: The equity portion of the NPS is subject to market risk.
  • Limited Flexibility: There are restrictions on how the funds can be used before retirement.

Suitable for

  • If you're planning for long-term retirement savings and are looking for tax-saving options.

  • If you're looking for a mix of government securities and equities.

bBETTER GROWTH

bBETTER GROWTH help clients in navigating the National Pension Scheme to ensure a secure retirement by

  • Understanding Retirement Goals:

    Evaluating the client’s financial situation, retirement objectives, and risk appetite.

  • Explaining NPS Advantages:

    Clarifying tax benefits, pension growth, and portability features.

  • Investment Guidance:

    Recommending asset allocation and selecting suitable options based on risk profiles.

  • Contribution Strategy:

    Encouraging consistent SIP contributions to accumulate a retirement corpus.

  • Account Monitoring:

    Regularly assessing portfolio performance and adjusting allocations as needed.

  • Withdrawal and Exit Plans:

    Discussing lump-sum vs. annuity options, tax consequences, and partial withdrawal possibilities.

  • Regulatory Compliance:

    Ensuring adherence to regulations and ethical practices.

  • NPS Flexibility:

    Educating clients about flexible contribution and account options.

  • Lifecycle Advice:

    Offering guidance for pre- and post-retirement financial strategies.

  • Transparency:

    Providing clear communication and frequent updates on portfolio performance.