Start Atal Pension Yojana at the age of 18: Deposit ₹ 42 to ₹ 210 and get ₹ 5,000 monthly pension.

To ensure a bright future and regular income after retirement, proper financial planning at a young age is considered the wisest step. ‘Atal Pension Yojana’ (APY) run by the Government of India is a very reliable and government guaranteed social security scheme for everyone from unorganized sector workers to middle class youth. The biggest strength of this scheme is its principle of ‘compounding and early entry’. If a youth opens his account in this scheme exactly at the age of 18 years, he has to deposit only a nominal amount ranging from ₹42 to a maximum of ₹210 every month to get a lifetime pension ranging from ₹1,000 to ₹5,000 every month after the age of 60 years. By saving just ₹1.40 to ₹7 per day, a respectable life and financial independence in old age can be ensured.

As per the official chart prescribed by the Pension Fund Regulatory and Development Authority (PFRDA), a subscriber of 18 years has to make regular contributions till the age of 60 years (i.e. for a total of 42 years). Depending on the pension amount chosen, the monthly, quarterly or half-yearly installments are determined as follows:

(Note: To get a monthly pension of ₹5,000 at the age of 18, the total amount deposited over 42 years comes to about ₹1,05,840, while after 60 years the investor gets a lifetime pension of ₹60,000 and the entire fund of ₹8.5 lakh remains safe for the nominee.)

Atal Pension Yojana is not limited to just the investor, rather it creates a complete financial security circle for the entire family:

1. Life pension to shareholder: As soon as the account holder completes 60 years of age, the fixed pension (₹ 1,000 to ₹ 5,000) starts getting transferred directly into his bank account every month.

2. Equal pension for spouse: If the subscriber passes away due to any reason, his/her spouse continues to receive the same monthly pension amount for life without any deduction.

3. Lump sum corpus to the nominee: If both the shareholder and the spouse die, the entire accumulated fund under the scheme (ranging from ₹1.7 lakh to ₹8.5 lakh) is legally handed over to the nominee as a lump sum.

The basic conditions for opening an account in Atal Pension Yojana are very simple and transparent:

• Age Limit: The minimum age of the applicant should be 18 years and maximum age should be 40 years. The lowest premium has to be paid when you join at 18, while at 40 you have to deposit ₹1,454 per month for a pension of ₹5,000.

• Bank Account and Aadhaar: It is mandatory for the applicant to have an active savings account in any government or private bank or post office and linked to Aadhaar.

• Auto-Debit Facility: An ‘auto-debit’ mandate is set in the account for the monthly premium, whereby the premium is automatically deducted on the scheduled date.

• Income Tax Payer Rules: As per the rules of the Central Government, citizens who come under the Income Tax net are not eligible for this scheme. This scheme is specially designed for those who do not have any organized pension cover.

The process of opening an Atal Pension Yojana account is completely digital and hassle-free. Youth can login to their bank’s net banking or mobile banking app and choose ‘Social Security Schemes’ or ‘APY’ option. There, select your preferred pension slab (e.g. ₹5,000) and premium frequency (monthly, quarterly or half-yearly), fill in the nominee details and submit. Apart from this, it can also be started immediately by just visiting the nearest bank branch or post office, filling a simple form and giving a copy of the Aadhaar card. This small amount of money saved from pocket money at the tender age of 18 acts as a support in old age and provides financial self-respect throughout life.