The National Pension System is a very good way to save for your retirement. You can choose toinvest in the NPS schemeand create a considerable retirement corpus over your working life. The scheme is market-linked in nature thereby allowing you to earn inflation-adjusted returns and create a substantial corpus for your golden years.
To subscribe, you can invest in the NPS scheme online. Online investments are quick, convenient and simple and you don’t even have to step outside which is a blessing in this time of the pandemic.
Here are the ways in which you can invest in the NPS scheme online right from your home or office –
1. Through your bank account
The Pension Fund Regulatory and Development Authority (PFRDA) has authorized banks to allow their customers to invest in NPS. These banks are called Point of Presence (POP) and they allow NPS investments. You can find a list of authorized POPs on the official NPS website at the link https://www.npscra.nsdl.co.in/pop-sp.php. If your bank is a POP and you are a customer, you can invest in the NPS scheme online through the net banking facility offered by your bank. Log into your net banking account and invest in NPS. Choose the type of NPS account that you need and the NPS fund managers to manage your investments. The amount of contribution that you choose would be directly debited from your savings account and your NPS account would start.
2. Through NPS website
Another alternative mode to invest in NPS online is through the official NPS website itself. You can visit https://enps.nsdl.com/eNPS/NationalPensionSystem.html to invest in the NPS scheme online. On the website choose ‘National Pension System’ and register yourself as an investor by providing all the required details. Your PAN card number would be a mandatory requirement when investing in the NPS scheme. An OTP would be sent to the mobile number registered with your PAN card and you have to furnish the OTP to complete the registration process. Once registered, you can start investing by choosing the type of NPS account you want to open, the NPS fund managers to manage your investments, the investment strategy and other details required. You would then have to upload your KYC documents and contribute towards the NPS account online. Once the payment is credited, your NPS account would be opened and you would get a Permanent Retirement Account Number (PRAN). Lastly, you would have to download the completed registration form and mail it to the Central Recordkeeping Agency (CRA) within 90 days of opening an online account. You should also mail your photograph and KYC documents along with the registration form.
3. Through ETMONEY app
The ETMONEY mobile application also allows you to invest in NPS online. You just have to download the application on your mobile, register yourself and start investing. It is a simple way to invest where all the investment formalities are done online at the click of a button.
So, these are the two ways of investing in the NPS scheme online. When investing, however, the following things should be kept in mind –
- There are eight NPS fund managers and you can choose one. You can also switch between the NPS fund managers during the investment tenure if you want
- You must make the minimum contribution to the NPS scheme every year to keep your NPS account active. In Tier, I Account the annual minimum contribution is Rs.1000 and you need to invest a minimum of Rs.500 to open the account. Similarly, for Tier II Account, the annual minimum contribution is Rs.250 and you need to deposit at least Rs.1000 to open the account
- Contributions to the NPS scheme qualify for tax benefits. You can claim a total tax deduction of up to Rs.2 lakhs (Rs.1.5 lakhs under Section 80CCD (1) and Rs.50,000 under Section 80 CCD (1B)) by investing in the NPS scheme
- The investment strategy that you choose can be changed during the investment tenure
- The investment funds that you choose can also be changed during the investment tenure
- Investments can be done till you reach 60 years of age after which the NPS account matures
So, if you are looking to create a retirement corpus, look no further. Choose the NPS scheme and create a market-linked, inflation-adjusted and tax-saving corpus for your retired life.