Invest today for a comfortable tomorrow

NPS – A Govt. of India Initiative

Planning for Retirement Pension

Are you saving enough for a comfortable retirement?

Retirement is all about getting to do things you've

always wanted to do like : An extra vacation or a foreign holiday Pursuing a hobby,sport or an art Maintaining the same lifestyle you currently enjoy.

But inflation eats away your purchasing

power…For example:Your current age is 30yrs & monthly expenses is Rs.30000. After 30 yrs the value of monthly expenses will be Rs.3.2

lacs, assuming inflation rate grows @ 8%.

Because of this compounding effect of inflation over time, you will lose significant value of your hard earned savings. Invest sensibly and benefit from

the power of compounding to beat inflation.

NPS – A Govt. of India initiative

What is NPS? How did it start?

(NPS), is managed by the Pension Fund Regulatory and Development Authority (PFRDA),the apex body established by Govt. of India to regulate and develop the pension sector in India .

To provide old age income

Reasonable market based returns over the long term

Extending old age security coverage to all citizens

National Pension System (NPS) is designed to give a way for all citizens of India to contribute towards Pension & enjoy pension benefits during their old age retirement.

How does NPS work?

You can subscribe to NPS by contributing periodic sums towards your pension during working life.

Regular contribution will gradually accumulate into a big corpus over the years.

When a subscriber attains 60yrs, he/she can use min 40% of corpus to buy Annuity & take the balance money out as lump sum or in installments.

A subscriber opting to exit before 60 can keep 20% of savings & invest balance in annuities.

Why NPS?

Low Cost Investment :The fixed costs & transaction charges are lowest compared to other investment products in today’s market.

It is flexible: Client can choose/switch the investment option and Pension Fund Manager and monitor their contribution & growth.

Tax Benefits – Individual as well as employer’s contribution to NPS is eligible for tax exemption as per the Income Tax Act, 1961 as amended from time to time.

Govt. regulated: NPS is regulated by PFRDA, with transparent investment norms and regular monitoring and performance review of fund managers by NPS Trust.

Reasonable market based returns over the long term.

Cheapest Investment Option

Comparison of Charges

Mutual Fund Charges*Particulars Charges Investment Amt-100000Asset Management Charges 1.25 1250Auditors Fee 0.15 150Registrar Charges 0.12 120Marketing/Dealing/Selling Expense 0.8 800Trustee Fees 0.11 110Custodian Fees 0.07 70Total Charges 2.5 2500

NPS Charges*Particulars Charges Investment Amt-100000Registration Charges 100 100Transaction Charges 0.25% 250Total 350

NPS cost comes to around 1/6th of what a mutual fund charge No tax rebate for investment into mutual fund

* Example

NPS – Product features

Age of Entry 18yrs up to 60yrs

Types of Accounts Tier I (Non-withdrawal a/c)*

Tier II (Withdrawal a/c)

Contribution for Tier I • Min amt per contribution: Rs.500• Min contribution per FY: Rs.6,000 • Min no. of contributions: 1 per yr• No upper-cap of investment

Choice of any one Fund Manager

ICICI Prudential Kotak Mahindra Reliance Capital SBI UTI

Choice of any 1 Investment option : Asset classes – (Equity, Debt funds, Govt. securities)

Active – Subscriber decides on allocating his Pension wealth in 3 asset classes

Auto Choice – Predefined allocation based on age& risk profile

* HDFC securities is currently offering only Tier-I account

NPS – Product featuresTier I - Withdrawal After 60yrs - At least 40% of the corpus to be

used to buy annuity & withdraw remaining funds in Lump-sum or deferred withdrawal. Or you can Opt for 100% annuity.

Before 60 yrs – You can keep 20% of the corpus & invest the rest in annuities offered by insurance companies.

Incase of Death - Option will be available to the nominee to receive 100% of NPS pension wealth in Lump sum.

Tax Benefits only for Tier-I

Individual contribution to NPS a/c is eligible for tax deduction under Section 80C of the Income Tax Act 1961.

Employer contributing up to 10% of Basic salary to the NPS account of an employee, is eligible for additional tax exemption under Sec 80CCD (2) as per the Income Tax Act, 1961.

NPS – Illustration

*Expected returns under NPS are market driven & are subject to change from time to time. Hence, there is no guaranteed/defined amount of return.

**Your monthly Pension can be higher if one increases % of annuity from 40% to max upto 100%.

How to open a NPS a/c?

You can subscribe to NPS through designated POP (Point of Presence) i.e HDFC securities Ltd.

Every subscriber of NPS will have a Permanent Retirement Account No. (PRAN), which will be a unique no. for lifetime.

To open an NPS account :

Download NPS subscriber application form on our website – www.hdfcsec.com (NPS section)

Attach

1 Passport size photograph

1st contribution cheque in favor of “HDFC securities Ltd – NPS”

Identity proof

Address proof

Forward the duly filled & signed application to our nearest HDFC securities branch or our representative can collect the application at your door stop.

For any further queries, visit our website www.hdfcsec.com or call our customer care @39019400

Thank you