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NPS Diwas: how India’s pension system is growing beyond savings

India is observing NPS Diwas on October 1, marking a shift in how the country thinks about retirement planning, according to reports.

The National Pension System, long seen as a tool to build a lump-sum corpus, is expanding into lifelong financial cover. Landmark additions include NPS Vatsalya, which lets parents open an NPS account for a minor child with just Rs 250, and the newly structured NPS Swasthya for integrated healthcare coverage.

NPS Vatsalya accounts can be opened for children aged 0 to 18, with a minimum annual contribution of Rs 250 and no upper limit. Market-linked investment choices, with up to 75% equity allocation, use decades of compounding. At 18, the account converts into a standard NPS Tier-I account.

Frictionless digital onboarding, including Tatkal NPS, is broadening access across life stages, the Pension Fund Regulatory and Development Authority says.

The message of NPS Diwas: retirement planning is no longer only for middle-aged earners. From a child’s first savings to healthcare in old age, the pension framework now touches the whole lifespan.

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