NPS Tips: These 3 benefits start coming from NPS even before retirement, very few people know this!
If you are also considering retirement planning, then NPS is a good scheme. By investing money in it, you get an excellent return. Although most people believe that by investing money in NPS, a pension is guaranteed for old age. But do you know that NPS gives you many benefits even in the days of youth? Keep in mind, these benefits are available separately along with eliminating the worry of money in old age. So let's know what benefits you get from NPS in youth.
Get additional tax exemption
If we talk about the NPS scheme, then tax exemption is also available on the money invested in it. This tax exemption is also not ordinary. Tax exemption is available on investment in NPS under section 80CCD of Income Tax. It also has two sub-sections - 80CCD (1) and 80CCD (2). Apart from this, 80CCD(1) has another sub-section 80CCD(1B). Under 80CCD(1), you can get a tax exemption of Rs 1.5 lakh, and under 80CCD(1B), you can get a tax exemption of Rs 50,000. Apart from this exemption of Rs 2 lakh under 80CCD(2), you can also get more income tax exemption.
Benefit from employer
You get tax exemption on investment in NPS from the employer. Under this, you can invest up to 10 percent of your basic salary and dearness allowance in NPS and you will get tax exemption on it. If you are a government employee, then this figure can be up to 14 percent for you. Most companies provide the facility of NPS. You can invest in NPS through the HR of the company. The good thing is that you will be able to get additional tax exemptions. You will get tax exemption in youth, meaning your money will be saved, which will be useful for you.
Money will not be spent unnecessarily
When a person gets a job, in the initial days everyone spends money here and there. However, after a few years, everyone starts understanding that to live a better life in old age, it is necessary to invest in youth itself. Although there are many schemes and tools for investment, the biggest advantage of NPS is that you can withdraw the money deposited in it only after retirement. This means that its lock-in period is not 5 years or 15 years like other schemes, but is up to the age of 60 years. In this way, the investment of the youth remains safe for old age. If the lock-in is less, then many times people use that money to buy a car or house or in some medical emergency, due to which the security of old age becomes weak.
Return according to risk
In all investment schemes, you get fixed returns or such returns over which you do not have control. If you invest in NPS, you can decide for yourself how much money you want to invest in the stock market and how much money is in fixed-return instruments. In youth, one can take more risks. In such a situation, you can get more returns by taking more risk, which will help you in accumulating a large corpus in the coming days. With increasing age, when you feel that you have to take less risk, then change the investment in NPS accordingly, which will benefit you.
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