NPS Vatsalya Scheme For Kids Launched| NPS Account| FM Sitharaman| National Pension Scheme| News9

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The government has introduced an investment option for parents of minors. Using this, parents whose kids are below the age of 18 can contribute as little as 1,000 rupees a year to ensure the long-term financial safety of their children. The option comes by way of the NPS Vatsalya scheme, launched by Finance Minister Nirmala Sitharaman.

However, the scheme was originally announced during this year's budget speech on July 23rd.

The NPS Vatsalya is an extension of the existing National Pension Scheme. The difference is the new scheme focuses on those below 18 years of age. The scheme is managed by the Pension Fund Regulatory and Development Authority or PFRDA.

As for the eligibility for NPS Vatsalya, you must be an Indian citizen and the child should be under the age of 18 years. In addition, all involved individuals must have their KYC compliance handy.

Talking about the investment amount, the minimum contribution is 1,000 rupees, and there is no upper limit on how much parents and guardians can invest.

But what if you wish to withdraw some amount from your NPS Vatsalya account even before the child attains the age of 18? In that case, withdrawals can be made subject to certain rules. After three years of joining the NPS, partial withdrawals are allowed, and you can withdraw up to 25% of the amount you have invested. This option is available three times until the subscriber reaches the age of 18.

After the child turns 18, the existing NPS Vatsalya account can be continued and converted into a regular NPS Account.

There is also an option to exit the NPS. In case the total invested amount is below 2.5 lakh rupees, the entire amount can be withdrawn as a lump sum. However, if the amount is above 2.5 lakh rupees, then at least 80% of the amount must be reinvested into an annuity plan, while the remaining 20% can be withdrawn as a lump sum.
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[sarojnaik]

From where the money come for investment for self n for children??