HOW YOUR MONEY IS INVESTED FOR RETIREMENT?

You get the choice of 3 funds under NPS:

• Equity (E)
• Corporate Bonds (C), and
• Government Securities (G)

Additionally, you also get the choice of 2 Investment Options:

• Active Choice: You have the freedom to choose your own asset allocation mix (exposure to Equity fund being restricted to maximum 50%).
• Auto Choice: You don’t have to do anything as NPS automatically sets your asset allocation by adjusting across the above 3 funds based on your Age (as per your Date of birth) as shown in below chart

Your Age	Equity (E)	Corporate Bonds (C)	Government Securities (G)
<=35 Yrs	50%	30%	20%
36	48%	29%	23%
37	46%	28%	26%
38	44%	27%	29%
39	42%	26%	32%
40	40%	25%	35%
41	38%	24%	38%
42	36%	23%	41%
43	34%	22%	44%
44	32%	21%	47%
45	30%	20%	50%
46	28%	19%	53%
47	26%	18%	56%
48	24%	17%	59%
49	22%	16%	62%
50	20%	15%	65%
51	18%	14%	68%
52	16%	13%	71%
53	14%	12%	74%
54	12%	11%	77%
>= 55 Yrs	10%	10%	80%

The re-alignment of your portfolio under ‘Auto Choice’ option is automated and is exercised every year on your Date of birth.

Lastly:

• You will have various Investment Option (Auto/Active Choice) for Tier I and Tier II accounts
• You will also be able to change your Asset Allocation Mix & Investment Option (Auto/Active Choice) once in a financial year for both - Tier I and Tier II accounts.
• There is no fixed interest on national pension scheme and it entirely depends on how you spread your investments between equities (E) and fixed income funds (G) & (C).

WITHDRAWAL FROM NPS

Partial Withdrawal from the Scheme

In the entire life span, 3 partial withdrawals are allowed from Tier I account before attainment of at 60 years as shown below

• First withdrawal will be after 3 years of account opening
• 2nd and 3rd withdrawal would be after a gap of 5 years from the first withdrawal

25% of the Contribution amount will be allowed for specific purposes like Child marriage, Higher education, Treatment of Critical illnesses, buying home etc.

Exit from the Scheme

Subscriber can exit from the Scheme after 10 years of account opening or on attainment of the age 60 years whichever is early. The payout will be defined as per the exit age of the Subscriber.

Exit before the age 60 years	Exit at the age 60 years(E)
Up to 20% of Corpus can be withdrawn in lump sum	Up to 60% of Corpus can be withdrawn in lump sum
Balance amount needs to be invested in Annuity	Balance amount needs to be invested in Annuity
If the Corpus is less than or equal to Rs.1 lakh, there is no need to invest into Annuity. Entire amount can be withdrawn in lump sum	If the Corpus is less than or equal to Rs.2 lakhs, there is no need to invest into Annuity. Entire amount can be withdrawn in lump sum

• Subscriber can defer the decision to invest in Annuity for 3 years.
• Subscriber can defer the decision of lump sum withdrawal for 10 years.
• Lump sum amount due for withdrawal at the age 60 can be withdrawn in 10 installments as per the choice of the Subscriber.
• If Subscriber does not want to exit at the age of 60 years, she can keep on contributing towards NPS till the age 70 years

Death Benefit

In case of death of the Subscriber the entire Corpus is given to the nominee. In case Subscriber has not opted for any nominee, the legal heir can claim the amount.

HOW YOUR MONEY IS INVESTED FOR RETIREMENT?

• NPS is based on Permanent retirement account Number(PRAN) created for individual members. NPS accumulates savings into subscriber's PRAN while he is working and use the accumulations at retirement to procure a pension for the rest of his life.
• NPS architecture consists of NPS Trust which is entrusted with safeguarding subscribers interests, a Central Recordkeeping Agency (CRA-Karvy/NSDL) which maintains the data and records, Point of Presence (POP-ACMIIL) and aggregators as collection and distribution arms, competing pension fund managers for generating and maximizing returns on investments of subscribers, custodian to take care of the assets purchased by the Fund managers and Trustee bank to manage the banking operations.
• NPS has an unbundled Architecture, with inbuilt checks and balances, where each function is performed by a different entity which is renowned in its area, to achieve maximum operational efficiency and at a low cost.
• KARVY/ NSDL is acting as Central Record Keeping agency (CRA) which is associated with various national level projects for record keeping functions.
• Financial Institutions like ACMIIL , acting as POPs (Point of Presence).
• Funds are managed by professional Fund Managers(PFMs)from Public & Private sector with proven track record and as per the PFRDA approved investment guidelines. At present there are 8 pension fund managers managing the pension wealth of subscribers.
• Axis Bank, functions as Trustee Bank.
• Stock Holding Corporation of India Ltd, functions as custodian for NPS