Retirement Planning: Everyone has to take special care of their retirement. You should make your portfolio very thoughtfully. You can take the services of a financial advisor for fund allocation.
Everyone plans for their retirement. Two plans are most preferred for retirement. One is the Employees Provident Fund (EPF) and the other is the National Pension System (NPS). We will discuss the features of both here.
Both of these options involve saving for your retirement. Save a large sum of money for yourself when you retire. EPF emphasizes the returns it receives every year.
NPS is a defined contribution plan, where your money is invested in the equity and debt markets. The aim is to combine your monthly contributions till retirement and convert them into a larger sum so that you can get a better pension.
In NPS you have the option to specify how much of your money can be invested in equities. But its maximum limit is 75 percent of the monthly contribution. You have no control over where your money is invested in EPF. It may invest between 5 percent and 15 percent of the fund in equities.
According to experts, EPF works better for essential retirement expenses because of the guaranteed income. At the same time, NPS is a better option for other additional expenses or pensions.
There is a provision of tax exemption for both EPF and NPS. You can declare taxable income up to Rs. 80C under Section 80C of the Income Tax Act. Can deduct. You can get a rebate of up to Rs 1.5 lakh on the amount you invest. For NPS, you can get an additional deduction of Rs 50,000 under Section 80-C (1B).
