The board of the Pension Fund Regulatory and Development Authority (PFRDA) has authorized growing the age limit for joining the National Pension System (NPS) from 65 years to 70 years with no cap on the maximum investment limit supplied the sources are declared.
This would allow tax savings with contributions to the NPS to be made up to 75 years of age. The yearly investment quantity is versatile with the lowest investment quantity getting Rs 8,000 per annum, Supratim Bandopadhyay, chairman, PFRDA, mentioned at a session of the MCC Chambers.
Earlier the age bracket for opening an NPS account was 18 to 60 years, which was later enhanced to 65years.
In India the pension schemes are fragmented and total contribution below different pension schemes has been much less than Rs 30 lakh crore with only 12.64 crore beneficiaries. The total deposits in different pension funds make only 14% of India’s GDP. All other nations obtaining pension schemes, save Russia, are properly ahead of India with the pension funds of the Netherlands producing the highest at 191% of its GDP. Russian pension funds make only 6% of its GDP, Bandopadhyay mentioned.
NPS, that invests mostly in 4 asset classes, has got the highest return from equity – 12.45%, followed by corporate bonds 10.07%, central government bonds 10% and state government bonds 9.89%. Investment in government securities has yielded 9.64%. All these have been for a period of 11 years, Bandopadhyay mentioned.