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New Delhi. Pension is considered a very good source of income after retirement. To promote pension, the government had announced the NPS Vatsalya Yojana in Budget 2024 this year.
Finance Minister Nirmala Sitharaman had said in the budget speech that children will get the benefit of pension in a way under the NPS Vatsalya Yojana. Keeping in mind the future of children, Finance Minister Nirmala Sitharaman will launch the NPS Vatsalya Yojana today. Let us know about this scheme in detail.
What is NPS Vatsalya Plan?
Parents or guardians can invest in this scheme to make the future of children bright. This scheme has been started with the aim that when the children grow up, they are financially stable. There is no eligibility for investing in this scheme, that is, all citizens of India can invest in this scheme. This scheme will be operated by the Pension Fund Regulatory and Development Authority (PFRDA).
Investment Limit in NPS Vatsalya Plan
There are many options for investing in NPS Vatsalya Yojana. The investor has to choose one of these options. A minimum of Rs 1000 has to be invested annually in this scheme. However, there is no maximum limit of investment in it.
Premature Withdrawal Option
In this scheme, the investor also has the option of premature withdrawal. This means that the amount can be withdrawn from the scheme before maturity. This scheme has a lock-in period of 3 years, which means that the investor cannot make any withdrawal after 3 years from the date of investment.
25% of the fund can be withdrawn for illness or education. In case of disability, the investor can withdraw more than 75% of the amount. Only 3 partial withdrawals are allowed until the child turns 18.
When will this scheme mature?
This scheme matures when the child turns 18 years old. If the amount in the fund is less than Rs 2.5 lakh, then a lump sum withdrawal can be made. However, if the amount is more than Rs 2.5 lakh, then only 20 percent of the amount can be withdrawn. Annuity can be purchased with the remaining amount. This will give the child the benefit of a fixed amount i.e. pension every month.
At the same time, this scheme can be continued even after the child turns 18 years old. If you want to continue the scheme even after the child turns 18, then you will have to give information about it in advance. After this, NPS Vatsalya will be made NPS Tier-1. After the child turns 18, KYC will have to be done again within three months.