NPS: The process of including new rules in the National Pension System (NPS) has been started. With this, it will become very easy and beneficial for the employees coming under the purview of NPS to withdraw money.
The Pension Fund Regulatory and Development Authority (PFRDA) has made full preparations to bring these changes to the ground.
PFRDA had made it clear in the circular issued on October 27, 2023 that by making changes in Rule 3 and Rule 4, it is going to start Systematic Lump Sum Withdrawal (SLW) for withdrawal of money after the stipulated time. Under this, NPS account holders will be able to withdraw up to 60 percent of the amount deposited in the pension fund. In SLW, you will have the freedom to withdraw money on monthly, quarterly, half-yearly or yearly basis till the age of 75 years as per your convenience.
What is SLW?
If we want to understand it in simple words, then it is similar to the Systematic Withdrawal Plan (SWP) available under mutual funds. People coming under the purview of NPS will be able to withdraw money within the time interval of their choice. Under this, whatever option you choose from your 40 percent fund after reaching the age of 60, the retired employee will continue to be paid continuously till the age of 75 years.
You will be able to withdraw the remaining 60 percent of the fund together or systematically under SLW. With the help of SLW, pensioners will continue to receive money. This will ensure that they have a fixed income after retirement and will not be burdened with expenses. In this process, you will get the opportunity to choose the option once.
Who will benefit from SLW?
Those who want a fixed income even after retirement will benefit greatly from this scheme. This benefit can be availed at the time of retirement.
How does NPS work?
NPS is a program run by the Government of India, which operates under the supervision of PFRDA. NPS invests money in many places including equities, government securities and corporate bonds. In this way NPS keeps strengthening its retirement fund.
