NPS Vatsalya Yojana has been launched. The scheme was announced in the Union Budget 2024-25, which aims to provide a strong financial foundation to all the children of the country. On this special occasion, school children will also be present with the Finance Minister, and an online platform for investing in the scheme will be launched. Also, a book giving detailed information about the scheme will also be released.
Under this scheme, Permanent Retirement Account Number (PRAN) cards will be given to minor subscribers. To make the NPS Vatsalya scheme more comprehensive and reach more people, programs will be organized at 75 locations in India, which will be connected to the main event in Delhi through video conferencing. Also, PRAN membership will be given to minor subscribers at various locations.
How much money can you invest?
Under the NPS Vatsalya scheme, parents can invest in a pension account to secure their children’s future. The scheme offers the opportunity to create wealth for the long term by leveraging the power of compounding. The scheme has multiple investment options, and parents can start investing in their children’s name with as little as ₹1,000 annually. This makes the scheme accessible to all sections of society and promotes financial inclusiveness.
Lock-in period and withdrawal
Under the NPS Vatsalya scheme, there is a lock-in period of 3 years on investments. After this, up to 25% of the deposit amount can be withdrawn for needs such as education, critical illness, or disability. This withdrawal facility can be availed a maximum of three times.
Special facility for private employees
In the Union Budget 2024, it has been proposed to increase the rate of employer contribution to the National Pension System (NPS) for private sector employees from 10% to 14%. Employees who opt for the new tax regime will be entitled to employer contribution of up to 14% of their salary to the NPS account, whether they are from the private or public sector.
Should you invest in this scheme?
NPS Vatsalya Yojana is a golden opportunity for parents who want to secure their children’s future. By starting investing early in this scheme and saving regularly, parents can create a large corpus for their children. This scheme is in line with the government’s vision of financial security and can prove beneficial for all age groups.