What is NPS?
National Pension System
NPS is a voluntary, market-linked retirement savings scheme regulated by PFRDA, where contributions are invested across equity, corporate bonds, and government securities based on your chosen allocation. At retirement, part of the corpus must be used to buy an annuity for a monthly pension.
NPS offers an additional ₹50,000 tax deduction under Section 80CCD(1B), over and above the ₹1.5 lakh Section 80C limit — a benefit no other retirement product provides. As per PFRDA's December 2025 rules, up to 80% of the corpus can be withdrawn as a lump sum at maturity if the total corpus is ₹5 lakh or less; otherwise, at least 40% must go toward an annuity purchase (varies by exit type).
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