How to Invest in NPS Online?

The National Pension System (NPS) is a government-regulated retirement savings scheme designed to provide financial security during your golden years. Offering a blend of tax benefits, market-linked growth, and flexible investment options, NPS has emerged as a popular choice for long-term retirement planning. In this article, we’ll explore the types of NPS accounts, factors to consider before investing, and a step-by-step guide to investing in NPS online. Plus, discover how Bajaj Finance Fixed Deposit (FD) can complement your NPS portfolio with assured returns and financial stability.

The National Pension System offers two types of accounts: Tier I and Tier II. Each account is tailored to meet different financial goals and offers unique features.

Tier I account (Mandatory)

The Tier I account is the mandatory account for NPS investors. It serves as a long-term savings tool with strict withdrawal restrictions, making it an ideal choice for retirement planning.

Key Features:

• Tax Benefits:
  • Deduction under Section 80CCD(1) (up to 10% of salary for salaried employees or 20% of gross income for self-employed), within the Rs. 1.5 lakh limit of Section 80C.
  • Additional deduction of Rs. 50,000 under Section 80CCD(1B)—over and above the 80C limit.
  • Employer contribution eligible for deduction under Section 80CCD(2) (up to 10% of basic + DA; 14% for government employees; extended to 14% for private sector employees under the new tax regime from FY 2025-26).
• Lock-in Period:
  Locked until age 60. Partial withdrawals are allowed under specific conditions like higher education, critical illness, or marriage.
• Market-Linked Returns:
  Contributions are invested in a mix of equity, corporate bonds, and government securities, based on your selected investment option—Active Choice or Auto Choice.

Tier II account (Voluntary)

This is an optional, flexible savings account under the NPS umbrella.

Key Features:

• No Lock-In Period:
  You can withdraw funds anytime, making it ideal for medium-term goals.
• No Tax Benefits:
  Contributions to Tier II accounts are not eligible for tax deductions.
• Investment Flexibility:
  Offers similar asset allocation as Tier I, but without restrictions on withdrawals.

Tip: Planning partial withdrawals from your Tier II account? 

Consider parking your surplus in a Bajaj Finance Fixed Deposit. With returns of up to 7.30% p.a. for senior citizens and 6.95% p.a. for others, plus tenures ranging from 12 to 60 months, it provides safe and predictable growth. Open FD. 

Investing in NPS requires a clear understanding of your financial goals, risk appetite, and the scheme’s long-term nature. Here are some essential pointers:

Choose the Right Account Type

• For long-term retirement savings and tax deductions, opt for Tier I.
• For flexibility and liquidity, choose Tier II.

You can invest in both if you want to balance long-term and short-term objectives.

Understand Lock-In and Market Risks

Tier I investments are locked in until retirement, ensuring disciplined saving. However, NPS returns are market-linked and can fluctuate based on performance across equity and debt instruments.

Diversify Your Portfolio

While NPS offers market-linked growth, diversifying your portfolio is crucial to mitigate risks. Bajaj Finance Fixed Deposit can act as a secure fallback, offering consistent returns even during volatile market conditions. 

With interest rates of up to 7.30% p.a., Bajaj Finance FD ensures financial stability, making it an excellent complement to your NPS investment strategy. Invest now!

Investing in NPS is now a simple and secure online process. Follow these steps:

Step 1: Register Online

Visit the official NPS Trust Website (https://www.npstrust.org.in) or a trusted Point of Presence (PoP) platform. Select the ‘Register’ option and enter your details.

Step 2: Complete KYC Verification

Upload your PAN card, Aadhaar card, and a recent photo. Ensure the information matches your existing records to avoid processing delays.

Step 3: Choose Account Type

Select Tier I, Tier II, or both based on your investment goals.

Step 4: Select Investment Preference

You can choose between:

• Active Choice: Manually set asset allocation (Equity, Corporate Bonds, Govt Securities).
• Auto Choice: Age-based automatic allocation.

Step 5: Make Your Contribution

Fund your account using net banking, debit card, or UPI. The minimum initial contribution for Tier I is Rs. 500.

Step 6: Receive PRAN

Once processed, you’ll receive your Permanent Retirement Account Number (PRAN), which is your unique identifier for all future NPS-related transactions.

Are you planning your retirement?

Add Bajaj Finance Fixed Deposit to your investment mix. It offers predictable, fixed returns, and a steady income stream—ideal for retirees. Check latest rates (up to 7.30% p.a.).

The National Pension System is a comprehensive retirement planning tool that combines tax savings, disciplined investing, and market-linked returns. Whether you're committed to long-term saving via Tier I or prefer flexibility with Tier II, NPS can help you secure your post-retirement life.

But no plan is complete without diversification. Bajaj Finance Fixed Deposits provide the safety and predictability NPS lacks during market fluctuations—making them a strong companion in your retirement strategy. With stable returns up to 7.30% p.a. and high credit ratings, they offer peace of mind and financial confidence.

Start building your future today. Invest in NPS online and complement it with a Bajaj Finance Fixed Deposit for a balanced, future-ready financial portfolio. Open FD.