• UGI USER
  • Jun 22, 2024
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PENSION FUND NEW CHANGES

Why in the news?

Deepak Mohanty, Chairman of PENSION FUND, announced plans to introduce new life cycle fund options for NPS subscribers by September, aiming to enhance equity exposure and accommodate changing subscriber needs.

Key Points:

  • NPS age tapering will extend to 45 years from 35, with increased equity exposure adjustments.
  • New LC75, LC50, LC25 life cycle fund options offer customizable equity and debt allocations.
  • APY gained 1.24 crore new FY24 subscribers, over half women.
Source: IE
About National Pension Scheme

Introduction and Evolution:

  • NPS, launched on January 1, 2004, provides retirement benefits to Indian citizens.
  • Initially for government recruits, it expanded to all citizens from May 1, 2009, including unorganized sector workers voluntarily.

Key Features:

  • Voluntary contributions allow flexible investments anytime.
  • PRAN ensures a unique identifier for each subscriber, offering portability nationwide.
  • Managed by PFRDA, NPS lacks defined benefits, with wealth accumulation based on contributions and market returns.

Investment and Exit Options:

  • Contributions are pooled into diversified portfolios including government bonds, bills, and shares.
  • Subscribers can exit or opt for superannuation, ensuring flexibility till retirement.