1st October is celebrated as International Day for Older Persons world wide. Taking a clue from this event, the Pension Fund Regulatory & Development Authority (PFRDA) has announced to celebrate 1st October as NPS Diwas. NPS stands for National Pension System and is a flagship retirement corpus building investment in the country. NPS is a contributory pension system introduced by the Government of India on 1st January 2004 via Ministry of Finance.
By celebrating NPS Diwas PFRDA emphasizes that, this is a day to promote pension and retirement planning. Citizens of India should help create more awareness among their colleagues and family members to opt for NPS product and build good retiral corpus for achieving financial independence for self and society.
National Pension System (NPS) provides good platform as a retiral product and is quite popular these day among private sector and government employees due to various reasons such as :
- provides additional deduction for investments up to Rs. 50,000/- in Tier-I NPS account under 80CCD (1B) which is over and above Rs. 1,50,000/- of Section 80C benefits.
- under Section 80CCD (2) NPS allows salaried individuals to claim deductions up to 10% of their salary towards employer contribution to their Tier-I NPS account and save tax. This is again over and above the Rs. 1,50,000/- of Section 80C benefits.
- NPS provides opportunity of investing up to 75% of the contribution in equity for higher risk and returns. This helps in generating good returns from equity markets as NPS is a long term product.
- lost cost of fund management of NPS benefits the investors.
As per data disclosed by NPS Trust, there are 1,62,79,804 subscribers and a total Asset Under Management (AUM) of Rs. 7,73,512/- Crore in National Pension System (NPS) by the 31st August 2022. This initiative of celebrating NPS Diwas across the country will spread awareness of the product among youth and others.
