What is the maximum contribution limit under the NPS

Solution

The NPS Vatsalya Scheme was proposed by Finance Minister Nirmala Sitharaman in the Union Budget 2024–25 speech and was officially launched on 18 September 2024. It is a National Pension Scheme (NPS) for minors, allowing parents or guardians to open an NPS account in the name of their children and contribute regularly towards building their retirement corpus. Key Features of NPS Vatsalya Scheme 1. The scheme is exclusively designed for minors (below 18 years). 2. Parents or guardians can contribute monthly or yearly until the child turns 18. 3. The minimum contribution required is ₹1,000 per year. Contribution Rules • Minimum Contribution: ₹1,000 per annum • Maximum Contribution: No limit (unrestricted contributions allowed) Exit and Withdrawal Rules • Joining Age: Below 18 years • Exit Age: 60 years (with an early exit option at 18 years) • Partial Withdrawal: Allowed up to 25% of the contributed amount • Exit at 18 years: 20% of the corpus can be withdrawn as a lump sum and 80% must be invested in an annuity plan Regulatory Authority • The scheme is regulated and administered by the Pension Fund Regulatory and Development Authority (PFRDA).