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What is NPS, how to invest, tax benefits, returns — complete Hindi guide for India.
Published by The Retail Trader · AUG 11, 2026 · Features
What is NPS, how to invest, tax benefits, returns — complete Hindi guide for India.
NPS = National Pension System. There is a retirement savings scheme of the government. Invest long-term, get regular pension on retirement.
Key features:
• Government-backed retirement fund
• Tax benefit under 80C + 80CCD(1B)
• Market-linked returns (10-12%)
• Lock-in till 60 (partial withdrawal allowed)
Keep these two points in mind:
• Tier I — Anyone (mandatory for govt employees)
• Tier II — Only if Tier I exists (voluntary, no lock-in)
Keep these four points in mind:
• Aggressive (LC-75) — Equity: 75%, Debt: 25%, Government: 0%, Risk: High
• Moderate (LC-50) — Equity: 50%, Debt: 50%, Government: 0%, Risk: Medium
• Conservative (LC-25) — Equity: 25%, Debt: 75%, Government: 0%, Risk: Low
• Auto Choice — Equity: Age-based, Debt: Age-based, Government: Age-based, Risk: Auto-adjusted
Default: Auto Choice (age-based allocation — young = more equity, old = more debt)
Keep these three points in mind:
• 80C — Limit: ₹1.5 lakh, Benefit: Standard deduction
• 80CCD(1B) — Limit: ₹50,000, Benefit: Extra deduction (NPS exclusive)
• 80CCD(2) — Limit: 10% of salary, Benefit: Employer contribution (if applicable)
Total possible deduction: ₹2 lakh+ (₹1.5L 80C + ₹50K 80CCD(1B))
Keep these three points in mind:
• 5 years — 10-12%
• 10 years — 10-11%
• Since inception — ~10%
Keep these five points in mind:
• Returns — NPS: 10-12%, PPF: 7.1%, EPF: 8.15%
• Risk — NPS: Medium, PPF: Very Low, EPF: Very Low
• Lock-in — NPS: Till 60, PPF: 15 years, EPF: Till retirement
• Extra tax benefit — NPS: ₹50K (80CCD(1B)), PPF: None, EPF: None
• Equity exposure — NPS: Yes (up to 75%), PPF: No, EPF: No
Keep these five points in mind:
• eNPS portal: enps.nsdl.com
• Aadhaar-based instant opening
• Minimum ₹1,000 per year
• PAN + Bank account required
• Get PRAN card (Permanent Retirement Account Number)
Keep these three points in mind:
• At 60 — 60% lump sum (tax-free), 40% annuity (mandatory)
• Before 60 — 20% lump sum, 80% annuity
• Partial — 3 times in tenure (max 25% of own contribution)
Keep these points in mind:
• 📌 NPS QUICK REFERENCE
• WHAT IS IT:
• 📊 National Pension System
• 📊 Govt-backed retirement fund
• 📊 Market-linked returns (10-12%)
• TAX BENEFITS:
• 📊 80C: ₹1.5 lakh
• 📊 80CCD(1B): Extra ₹50,000
• 📊 Total: ₹2 lakh+
• FUND OPTIONS:
• 📊 Aggressive (75% equity) — Young investors
• 📊 Moderate (50% equity) — Balanced
• 📊 Conservative (25% equity) — Near retirement
• 📊 Auto Choice — Age-based (recommended)
• NPS vs PPF:
• 📊 NPS: 10-12% returns, medium risk, ₹50K extra tax
• 📊 PPF: 7.1% returns, zero risk, no extra tax
• WITHDRAWAL:
• 📊 At 60: 60% tax-free, 40% annuity mandatory
• 📊 Before 60: 20% lump sum, 80% annuity
• 📊 Partial: 3 times, max 25%
• HOW TO OPEN:
• 📊 enps.nsdl.com
• 📊 Aadhaar-based instant opening
• 📊 Min ₹1,000/year
Keep these points in mind:
• Retirement Planning India | PPF Guide | Financial Planning Guide
The Retail Trader — educational market analysis. Not investment advice.
This article is for educational purposes only. It is not a buy or sell recommendation, a claim of guaranteed returns, or advisory guidance. Exchanges, SEBI and RBI change rules, rates and procedures from time to time, so verify every figure with your broker or an official source.