Everything about the National Pension Scheme for traders

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Are you looking for investment options to enjoy a stress-free retirement? Many individuals park their hard-earned money in mutual funds online because the investments offer benefits. But, if you are a retail trader or a shopkeeper, you can opt for the government’s pension scheme as a means to secure your future.

The National Pension Scheme for traders is a government initiative. It aims to provide social security and old age protection to shopkeepers, retail owners, and self-employed vyaparis with an annual turnover of less than Rs. 1.5 crore.

The pension scheme is a voluntary and contributory model wherein the government makes an equivalent contribution to the subscribers’ accounts. An NPS subscriber receives a minimum assured pension of Rs. 3000 every month after 60 years of age. In the unfortunate event of the death of the subscriber, the spouse receives fifty percent of the pension as a family pension.

Eligibility

  1. The scheme is open to laghu vyaparis. These include retail traders, self-employed persons, shop owners, and other vyaparis.
  2. The age of entry into the scheme is between 18 and 40 years.
  3. The laghu vyaparis should not have an annual turnover of over Rs. 1.5 crore.
  4. The traders must have an Aadhaar card and a savings account.

Benefits of the national pension scheme

  • Every eligible subscriber receives an assured minimum pension of Rs. 3000 per month after 60 years of age.
  • The subscriber contributes a specific amount each month as per age. This monthly contribution serves as a Systematic Investment Plan (SIP). The government makes a matching contribution. For instance, if an 18-year-old subscriber contributes Rs. 55 per month, the Central Government contributes the same amount as subsidy into the subscriber’s pension account.
  • In case the eligible subscriber has made regular contributions to the scheme and becomes permanently disabled before attaining the age of 60 years, the spouse can continue making regular contributions to the scheme. The spouse can also choose to exit by receiving the contribution deposited by the subscriber. This amount includes the interest calculated at the savings bank rate of interest thereon or the interest actually earned by the pension fund, whichever is higher.
  • In the unfortunate demise of the eligible subscriber, the spouse is entitled to receive fifty percent of the pension contributed by such subscriber.

The subscriber also enjoys certain benefits on exiting the government scheme. These include:

  1. If the eligible subscriber leaves the scheme in less than 10 years since the joining date, he will receive the contribution made by him along with the savings bank interest rate payable thereon.
  2. In case the subscriber leaves after completing 10 years from the joining date, but before turning 60 years old, he receives the contribution share with the accumulated interest thereon.

Last words

If you wish to plan for your retirement and have a low risk appetite with a low annual turnover, the National Pension Scheme for traders is ideal for you. Tata Capital Moneyfy App is the right platform to take care of your investment needs. It enables you to invest in different financial avenues.