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The National Pension System (NPS) is one of the easiest and simplest ways to plan for your retirement. And in this digital era, you can invest in NPS online without visiting your bank or POPs physically.
The National Pension System, commonly called New Pension Scheme, is a government-backed retirement savings plan that helps individuals build a financially secure future. NPS has built trust among its investors for various reasons. One of them is that it is regulated by the Pension Fund Regulatory and Development Authority (PFRDA), a government entity that oversees its transparency and functionality. Individuals can ensure a peaceful and financially secure retirement by investing in NPS, which allows them to save money consistently and watch their wealth grow gradually.
But how can you apply for NPS online? This blog will explain the steps to open an NPS Tier 1 and Tier 2 account and the benefits.
There are two types of NPS accounts – Tier 1 and Tier 2
NPS Tier 1 Account: This is a pension account that is meant for saving money for your retirement and is non-withdrawable. The contributions that you make to this account are invested in various assets such as bonds, stocks, and government securities. Upon retirement, the accumulated corpus can be used to purchase an annuity from a life insurance company that will provide a regular income stream during retirement.
NPS Tier 2 Account: This is a voluntary savings account that allows you to make additional contributions over and above the mandatory contributions made to Tier 1. This account provides more flexibility in terms of withdrawals and investment options. You can choose to invest your funds in a variety of instruments, including equity, debt, and liquid funds.
Steps to do eNPS Registration
To open an NPS account, you can visit nps.kfintech.com and follow the steps.
- Click on the ‘Join NPS’ option. You will be directed to a new page.
- Fill in your information, which includes
- Your full name
- Date of birth
- Mobile number
- PAN number
- Email ID
- Application type
- Resident type
- Agree to the terms and conditions
- Click on ‘Create an account’, and you will be redirected to the NPS page.
Investing in NPS – The Benefits
- Regulated by PFRDA (Pension and Fund Regulatory Development Authority) governs and ensures transparency.
- Voluntary: All Indian citizens can voluntarily participate in the NPS.
- Freedom: You have the liberty to choose your fund manager after registering for eNPS.
- Low-cost: Anyone can start investing in NPS with ₹500.
- Potential returns: NPS returns are linked with the market, they have the potential to provide you with long-term returns.
Conclusion
Investing in the National Pension System is not a heavy task. You just have some clarity regarding your investment’s goals and risk tolerance. You can visit the above-mentioned website to start investing in NPS and also learn more about it.
