Question About NPS

General
1

I have a bunch of questions can someone who does invest in NPS clarify them for me

  1. What are the charges for registering for NPS via Coin
  2. What are the charges per contribution for NPS
  3. For some like me 19Yr Currently Is NPS a good choice or should I continue with “normal” investment alternatives like MFs, Shares, ETFs etc. etc…
  4. What is the Expense ratio or AMC for NPS
  5. Is it outperforming Post considering charges
2

I am using NPS to get the additional 50000 income tax savings.

That money is long locked, cant withdraw :pensive:.

3

Depends on what is the purpose of your investment.
If you are investing for retirement corpus, NPS is a great tool. Added tax benefits are also useful.
I would consider mandatory lock in also as feature rather than bug (keeps your money safe from yourself :slight_smile: )

If you are investing for any short-term goal , then obviously it is a useless choice.

For a youngster, I would definitely suggest to get started with it, even if with small amount to test the waters.

Point 1,2, 4 & 5 - I am sure a 19 year old should be able to google it out :slight_smile:

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4

That is the feature of NPS, not a bug :stuck_out_tongue:
As I said previously, keeps your money safe from yourself

5

  1. Go with NSDL or any other direct providers. This avoids any POP charges.

  2. If via eNPS no charges - may be there are some charges with credit card.

  3. Normal is better if high returns expected. NPS better if you want to do investment for retirement till 60.

  4. HDFC, ICICI and axis (?) seem better as pension fund managers and the charges are higher compared to similar amount when put in MF. Pension fund managers charge quarterly as management fee. Units get deducted quarterly. When creating the account you’d be asked to choose one of 10 fund managers .

  5. No outperformance but it provides some sort of downside protection with debt and other investments . So NPS fares better in a down market against equity only investments.

POP adds 15 rupees and add to that GST charges. There is no point in using POP. If you are disciplined you can contribute monthly on the starting week of new month.

Overall you can save tax till 50000 if you start working and had to pay taxes . You can withdraw only 3 times in the entire lifetime and beyond it it’s not allowed. The withdrawal amount can only be on your contribution but not from your employer.

After 60, you can only withdraw 60% of total money and 40% will be like monthly pension.

Since the country is developing may be the restrictions and regulations change and may be we could opt for higher equity portions in NPS.

I’d suggest you read through the NPS details really well . So far the information I have given is what I know of . I may not be fully correct .

1 Like
6

That clears a lot Thanks @slow @Akash_Shah @viswaram