Know About the Benefits of National Pension Scheme in Detail 

With the objective of providing a substantial corpus and to ensure the provision of a stable income post-retirement, the government of India has launched NPS i.e. National Pension Scheme. Upon registering for NPS, a PRAN will be given to you and you can start invest in either Tier-1 or Tier-2 accounts. 

The Tier-1 account operates as a permanent pension account and offers withdrawals based on certain conditions only. The Tier-2 account allows you to make deposits and withdrawals more freely. However, to open a Tier-2 account, you will first need to open a Tier-1 account. You will need to make a minimum deposit of Rs. 500 in the Tier-1 account whereas the minimum deposit for the Tier-2 account is only Rs. 250. The major benefits and features of NPS are explained below:

Flexible choices 

NPS gives you the option of following either one of the two approaches while investing. The first approach is known as ‘Active Choice’ and it allows you to pick the allocation percentage of the funds in different asset classes. The second approach is called ‘Auto Choice’ and it allocates funds to the asset classes automatically depending upon your age. 

You will get the choice of selecting either of these two approaches once you choose a pension fund manager. 

Easy to maintain 

It is easy to maintain an NPS account irrespective of whether you change your job or location. This means that you can operate your NPS account from any part of the country and work in either the public or private sector or both till retirement. Therefore, there is no need to open a new NPS account when you start a new job to shift to another city. 

A stable investment option 

As NPS is controlled by PFRDA, it follows all the transparent investment policies and is considered to be a stable investment option. You get a part of your savings after retirement as a bulk amount and the remaining amount is used to provide you with a regular pension. 

However, NPS is a long-term investment avenue and is not flexible enough to provide you with immediate benefits. Therefore, you would also need to invest some of your earnings in another instrument like a fixed deposit so that you can exercise easy withdrawal procedures when necessary. Apart from that, you can predict the returns of fixed deposits as it offers pre-determined interest rates to investors. 

Moreover, you can invest in a lucrative FD scheme like Bajaj Finance FD as it is offering FD interest rates of up to 6.75%. Apart from the high-interest rates and stability of investment, it comes with these benefits and features:

Flexible tenor 

A flexible tenor from 12 to 60 months ensures that you can invest for long-term benefits or short-term gains. Moreover, you can invest in multiple deposits at once by attaining both the long and short-term objectives. 

You can opt for the multi-deposit facility that enables you to pick a different investment tenor and type for each deposit after splitting your corpus into several FDs. The payment for all the fixed deposits can be done with one cheque.

Easy withdrawal norms 

The withdrawal norms offered by Bajaj Finance Fixed Deposit are much more convenient and simpler as compared to NPS withdrawal policies. This is because you can withdraw your deposits once they complete a minimum period of 3 months from the date of deposit. Also, the option of availing of a loan against fixed deposits negates the need for early withdrawal. 

Using FD for regular income 

You may even use Bajaj Finance FD to earn a regular income post-retirement. For that, you will need to deposit your savings in a non-cumulative Bajaj Finance FD. Also, you have the option of selecting between multiple periodic interest payouts at your convenience. 

For example, you invest Rs. 20,00,000 in a non-cumulative Bajaj Finance FD for 5 years. The below table shows the periodic interest options that you can choose from:

You can use the FD interest calculator that is provided on the official website of Bajaj Finserv to explore the interest earnings for other combinations of principal amount and tenor.