The introduction of NPS has changed the landscape of post-retirement investment in India. While there are a bunch of investment plans in the market, NPS is making headways for all the right reasons. It combines the advantage of a sovereign guarantee and delivers the best possible return compared to other fixed-income plans.
But, to be eligible for that, you first need to complete the NPS online registration. Read on to learn more about this process and some associated details to help you make the right decision.
How to complete NPS registration?
Here are all the details you need to know about NPS new registration –
Online method
- Thee NPS registration starts with your visit to the official website of NPS.
- After that, you must click on the New Registration option and fill in a few essential details.
- Following that, complete the CKYC process, and Subscriber Registration will open.
- Then, you need to submit the details and generate an acknowledgement number. And, you are done.
- After that, once the PRAN is generated, login to your NPS account and make the initial deposit. Your account is active and ready.
- Furthermore, you can also complete pending registration of NPS easily using the official website.
Offline method
If you are not planning to do this online, you can download the NPS subscriber registration form, fill it out, and submit it to the nearest PoP. Make sure you also submit the initial deposit along with it.
Now, while submitting your NPS registration form, use black ink and block letters. Also, there should not be any errors or overwriting.
Reasons to trust NPS for investment
Now that you know how to complete NPS online registration, here are the reasons why you should trust it over others –
Returns are excellent
One of the main reasons behind the traction that NPS is receiving is the return it offers. When you stack it against the other fixed-income investment plans designed for post-retirement life, you will understand how it beats them. Currently, the NPS scheme generates an average return of 9% to 12% per annum.
Having said that, there are fixed interests in the NPS, so you must study the return of different SPs and then decide where you want to invest.
Sovereign guarantee
Another primary reason for you to complete your National Pension Scheme online registration on time without any delays is that it comes with a sovereign guarantee. It means the Indian government, or PFRDA, to be precise, is looking over the scheme.
The PFRDA or Pension Fund Regulatory and Development Authority makes the necessary adjustments to the scheme, reviews the performance of fund managers and the scheme and ensures transparency. So, the risks of investment are significantly lower.
Cap on the equity exposure
NPS, as an investment tool, comes with its share of equity exposure, but with a limitation. Currently, there is a 50% to 75% cap on its exposure to equity for all non-government employees, and for government employees, it is at 50%. At the same time, the equity exposure decreases by 2.5% every year when the investor crosses the age of 50.
Now, during your NPS PRAN registration, you get the chance to specify your equity exposure if you opt for the active scheme.
Flexibility
The flexibility that you enjoy during the National Pension Scheme registration continues to the investment process as well. This scheme allows you to contribute any time of the year and any amount you want. Also, you can change your fund manager if you don’t receive the desired returns.
At the same time, you also get the benefit of auto and active choice of investment. If you cannot decide how to divide the funds into different asset classes, you can opt for the auto. And, if you are convinced by your own calculations, then active is the right investment strategy for you.
How to calculate the return on NPS?
Computing the return on investment before NPS NSDL registration is crucial. It helps you map your investment journey and then make the right calls. Now, there are two ways to do it: manually and using an online calculator.
Since the manual process is time-consuming and error-prone, opting for the online calculator is a clever choice. These online financial planning tools streamline your investment decisions by doing all the hard work for you. All you need to do is enter the required investment details and adjust them based on the results to find exactly what you are looking for.
Things to keep in mind before investing in NPS
Here are a few things that you need to know before completing NPS online registration –
- The first thing to remember during NPS login registration is that it has two types of accounts: Tier I and Tier II. Opening a Tier I account is mandatory, but Tier II is optional.
- You will enjoy an income tax benefit of up to Rs.2 lakh on the contributions to the NPS account. But, the details of tax benefits will vary based on your employment. The pension you earn from NPS, however, is taxable.
- During the time of maturity, if your total account balance is more than Rs.5 lakh, then you need to use 40% of the account balance to purchase an annuity, and the rest will be available as a lump sum.
- It is possible to make a partial withdrawal from NPS, but you need to meet all its prerequisites. Also, only 3 partial withdrawals are possible during the whole tenure of the investment.
- Premature exit from the NPS is also possible, but then you need to get an annuity when
Conclusion
Hopefully, now you have all the details you need to complete NPS online registration without any hesitation. But, if you are still unsure, it is only fair to talk to experts, research and clear all your doubts before moving forward to get the best results.
FAQ’s:-
The minimum amount that you need to open an NPS account is Rs.500. But you need to make at least one contribution of Rs.1000 in a financial year to keep the account active.
Indians and NRIs within the age bracket of 18 to 70 can apply for the NPS.
Yes, you can choose a nominee while opening your NPS account.