How to open an NPS account
Opening a National Pension Scheme (NPS) account online is a quick and straightforward process. The Pension Fund Regulatory and Development Authority (PFRDA) allows individuals to enrol online through their eNPS platform. This digital method requires minimal paperwork and offers a hassle-free experience. Follow these steps to get started:
- Visit the eNPS website.
- Click on "Register".
- Select your preferred account type (Tier I or Tier II).
- Enter your Aadhaar or PAN details.
- Choose a Pension Fund Manager and investment option.
- Provide personal and bank account details.
- Upload supporting documents and a photograph.
- Complete payment for your contribution.
- Receive your Permanent Retirement Account Number (PRAN).
How to open NPS account offline?
To open an NPS account offline, visit a Point of Presence (PoP) registered with the PFRDA, such as banks or authorised financial institutions. Collect the NPS subscription form, fill it out, and attach required documents, including identity proof, address proof, and a passport-sized photo. Submit these along with the initial contribution. Upon processing, you will receive a Permanent Retirement Account Number (PRAN) for account management.
How to log in to national pension scheme account
Once your NPS account is successfully created and a PRAN (Permanent Retirement Account Number) is issued, you can log in and manage your account using several digital platforms such as the NSDL portal, KFintech portal, or your net banking interface.
Below is a step-by-step guide to accessing your NPS account:
Logging in via the NSDL NPS Portal
- Go to the official NSDL NPS website: https://enps.nsdl.com/eNPS/NationalPensionSystem.html
- Click on ‘Login with PRAN/IPIN’ to open the login page.
- If you already have your PRAN and password, enter the credentials and click ‘Submit’ to access your e-NPS dashboard.
First-Time Login Instructions (NSDL):
If you’re logging in for the first time, follow these steps to generate a new password:
- Visit the same NSDL NPS portal.
- Click on ‘Login with PRAN/IPIN’ and go to the login screen.
- Choose ‘Reset Password’.
- Enter your PRAN, date of birth, and create a new password. Confirm the password, solve the CAPTCHA, and click ‘Submit’.
- An OTP will be sent to your registered mobile number. Enter the OTP to confirm and activate your new password.
- Once set, you can log in using your PRAN and the newly created password.
Logging in via the KFintech NPS Portal
- Navigate to the KFintech NPS site: https://nps.kfintech.com
- Click on ‘Login’ and then select ‘Existing Subscriber’.
- On the login screen, input your PRAN, password, and the Captcha code. Click ‘Submit’ to access your account.
First-Time Login Instructions (KFintech):
If you're a new user, you’ll need to set a password before logging in:
- Visit https://nps.kfintech.com
- Select ‘Login’ > ‘Existing Subscriber’.
- Click on ‘Generate/Reset Password’ on the login screen.
- Enter your PRAN, date of birth, and Captcha, then click ‘Submit’.
- An OTP will be sent to your registered mobile number. Enter it and proceed to create a new password.
- Once done, log in using your PRAN and the new password
What is the user ID for National Pension Scheme login?
The User ID for National Pension Scheme (NPS) login is your Permanent Retirement Account Number (PRAN), a unique identifier provided upon registration, used for account access and management.
How is NPS calculated?
Before investing in NPS, it might be worth exploring how the returns are calculated and what pension amounts you can expect at the end of your tenure. Here is the formula for calculating NPS:
A = P (1 + r/n) ^ nt
where,
P = principal
r = rate of interest
n = number of times interest has compounded
t = total tenure
National Pension Scheme (NPS) interest rate
It is important to note that there is no singular interest rate for NPS. This is because NPS is essentially market-linked, which means the interest rate for its returns depends on the performance of the assets that you invest in.
To that end, here are the four types of asset classes in which you can invest with NPS:
Asset class
|
Asset type
|
Class G
|
Government Bonds
|
Class E
|
Equities
|
Class C
|
Corporate Bonds
|
Class A
|
Real Estate Investment Trusts (REITs), Commercial mortgage-backed securities, and alternative investment funds.
|
The scheme has been in place for more than ten years and has thus far produced annualized returns of 9% to 12%. If you are unhappy with the performance of the fund, NPS also gives you the option of switching fund managers.
Tenure
|
Invest till 65 years
|
Interest rate
|
9% - 12% p.a.
|
Investment amount
|
Starting at Rs. 1,000
|
Maturity amount
|
Depends on the initial investment amount
|
How to use NPS withdrawal money?
NPS investments are one of the most recommended modes of investment for people looking to fulfil long-term financial goals. This is because you can only exit an NPS and withdraw the resulting amount after a period of 10 years. NPS withdrawal money can therefore be utilised for looking after your retirement, funding your children’s education or wedding or making an essential purchase such as buying a home.
Read also: How to Download NPS Statement
Who should invest in NPS?
The National Pension Scheme (NPS) is advantageous for individuals aiming to proactively strategise for their retirement, particularly those with a conservative risk tolerance. The prospect of a steady pension income during retirement holds significant value, especially for individuals retiring from private-sector employment.
Embracing a systematic investment approach through NPS can yield substantial benefits in the post-retirement phase. Additionally, individuals with a desire to optimize their 80C deductions can find this scheme to be a valuable consideration, particularly those employed in salaried positions.
NPS v/s Bajaj Finance FD
To gain a better perspective on how an NPS investment fares against an investment such as the Bajaj Finance Fixed Deposit, here is a brief review of their comparison:
Feature
|
NPS
|
Bajaj Finance FD
|
Purpose
|
Investment to save for retirement
|
Investment for a variety of short-term or long-term goals
|
Tenure
|
Can only exit after 10 years
|
Can choose tenure between 12 to 60 months
|
Nature of Investment
|
Market-linked
|
Free from market risks
|
Interest Rate
|
Depends on the performance of the asset classes in which you have invested
|
can go up to 7.95% p.a. for senior citizens
|
Thus, from the above table, it is clear that Bajaj Finance FD has several advantages over NPS, in terms of flexibility and assurance of guaranteed returns. NPS is an ideal investment for those looking to accumulate a corpus for retirement as well as to fulfil various long-term goals.
Whereas Bajaj Finance FD is a great investment for the short-term as well.
Those looking to choose between the National Pension Scheme (NPS) and Fixed Deposit need to know about the features and benefits of each of these investment options. For the most part, NPS is typically considered an essential investment option for any working professional who wishes to save up for a comfortable post-retirement life.
Conclusion
The National Pension Scheme is an excellent option for anyone looking to build a substantial retirement corpus while enjoying tax benefits. Its low-cost structure, flexibility in investment choices, and government backing make it a reliable and effective tool for retirement planning. Whether you are starting your career or nearing retirement, investing in NPS can help secure your financial future.
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