On 18-Jun-2013, at 15:55, [email protected] wrote: > But, PF withdrawals are tax free after some reasonable conditions are > fulfilled- 5 years service, etc. > > The only annuity there is the EPS- given that you contribute barely 541/- a > month, it would still grow to 12 lakhs after 35 years- against which you get > a maximum of 3250/- per month as pension. That's a 3% rate of return on > capital. Why would the NPS be any different? >
Market linked to start with. Which - if you stick to it over 30+ years of service - hopefully gets you better returns. Such schemes ARE a pain in the ass when for example you quit a job in a country and move back to India, at a time when the stock markets are facing historic lows [I did, ask me..] The returns ARE a bit volatile - and the cost structure is loaded against people making small contributions. If you stay with a trusted fund manager and stay invested till your retirement it might be viable. It is still currently EET (exempt exempt taxed - that is withdrawals at retirement are taxable) but there's currently a proposal - I guess next budget, hopefully - to make it EEE. However, I personally am not going for this and am sticking to the EPF, which is guaranteed return. I know my contributions here and have other market linked investments that I can manage better and more actively than I can do with a pension fund. --srs
