There are many benefits of NPS before retirement..!!
Most people believe that by investing money in NPS, they will get a guaranteed pension in old age. This is true. But, apart from this, there are many other benefits that come with NPS. Apart from eliminating money worries in old age, NPS also provides many more benefits. In this post, you can find out about the benefits that NPS members can avail of before retirement. Thinking of Retirement Planning? If so, then NPS will be the best plan for you. You can invest money in it and get good returns. Most people believe that by investing money in NPS, they will get a guaranteed pension in old age. This is true. But, apart from this, NPS also offers many other benefits.
Many people don't know that NPS also gives you many benefits during your youth. Apart from eliminating money worries in old age, NPS also provides many more benefits. In this post, you can find out about the benefits that NPS members can avail of before retirement. The money invested in the NPS scheme is tax-exempt. This tax exemption is not ordinary. Investment in NPS is tax-exempt under Section 80CCD of Income Tax. It has two sub-categories – 80CCD(1) and 80CCD(2). Apart from this, there is another sub-section of 80CCD(1) and 80CCD(1B). Rs.1.5 lakhs under 80CCD(1) and Rs.50 thousand under 80CCD(1B) can be availed. At the same time, apart from this deduction of Rs.2 lakh under 80CCD(2), further deduction can be availed in Income Tax. Investment in your NPS is tax-deductible from the company. Under this, you can invest up to 10 percent of your basic salary and allowances in NPS. It is tax deductible. At the same time, if you are a government employee, it can be up to 14 percent for you. Most of the companies offer NPS facilities. Investment in NPS can be made through company HR. The good thing is that you can get additional tax deductions with this. You will get tax deductions in your youth which means your money will be saved which will be useful for you. Once one gets a job, many spend money unnecessarily here and there, often in the initial days. It is only after a few years that everyone starts to understand that to live well in old age, it is necessary to invest in youth.
Although there are many schemes and instruments for investment, the biggest advantage of NPS is that the money deposited in it can be withdrawn only after retirement. That is, unlike other schemes, its lock-in period is not 5 years or 15 years, but 60 years. In this way, the investment of youth is safe for old age. If the lock-in is low, many times people use that money for a car, house, or any medical emergency. Due to this, the aging defense becomes weak. In all investment schemes, you will get a fixed income and in some schemes, we have no control over the returns we can get. This is often the case with market-linked schemes. When investing in NPS, you can decide for yourself how much money you want to invest in the stock market and how much money you want to invest in fixed-income instruments.
Young people are more risk-taking. In such a situation, you can get more returns by taking more risks. This will help in accumulating a large corpus in the coming days. As your age increases and you feel you need to take less risk, you can change your investment in NPS accordingly. In this way, NPS helps us to make age-appropriate decisions. But before investing in NPS, it is advised to consult your financial advisor. For the latest and accurate information about NPS, it is recommended to access official government websites.