Old Pension Scheme: Amid protests in many states against the New Pension Scheme, there is information that the government has prepared an alternative to the Old Pension Scheme . Discussion is going on on bringing many new provisions in the New Pension Scheme.
This also includes minimum guaranteed returns. This is being discussed in the Finance Ministry. However, many state governments have already refused to adopt the New Pension Scheme and have retained the Old Pension Scheme.
Consider increasing the contribution
It is known that in the new pension scheme, there can be a plan for minimum guaranteed pension and the pensioner will also get additional income. It is also being considered to increase the contribution beyond 14%. Contribution will increase without burdening the exchequer. To increase the pension, it may be possible to invest more in Annuity. At present, 40% of the total fund is invested in annuity, which gives pension of about 35% of the last salary. However, being linked to the market does not guarantee it.
National Pension Scheme is in force since 2004
The National Pension Scheme (NPS) is effective in the country from April 1, 2004. The Old Pension Scheme (OPS) was abolished by the Vajpayee government in December 2003. In the old pension scheme, the pension was 50 percent of the last salary of the employee. The government used to pay its entire amount.
At the same time, NPS is for those employees who joined the government service after April 1, 2004. Employees contribute 10% of their salary towards pension. Apart from this, the state government contributes 14 per cent. The entire pension money is deposited with the pension regulator PFRDA, which invests it.
What is New Pension Scheme-NPS?
In the year 2004, the government started the National Pension Scheme. NPS gives investment approval to government employees. Under this, he can allow the investment of his money by making regular contributions to the pension account throughout his career. After retirement, a part of the pension amount is allowed to be withdrawn in lump sum. For the remaining amount, you can buy an annuity plan.
Annuity is a type of insurance product. A lump sum investment has to be made in this. It can be withdrawn monthly, quarterly or annually. He gets regular income till the death of the retired employee. At the same time, after death, the full money is received by the nominee.
