Financial independence for women has always carried a deeper meaning. It isn’t just about earning a salary. It’s about freedom, dignity, and the ability to make decisions without hesitation. But here’s a question few women pause to ask: what happens after the paychecks stop?
Retirement is inevitable. And when it comes, the choice is simple—you either depend on someone else, or you rely on the wealth you’ve built for yourself. For women, who often live longer, face career breaks, or carry family responsibilities, the stakes are even higher. That’s where the National Pension System (NPS) comes in—an affordable, tax-efficient, and flexible retirement plan designed to ensure that your financial independence lasts a lifetime.
Why Women Must Plan Retirement Differently
Women juggle multiple roles; professionals, caregivers, homemakers, entrepreneurs. But because of breaks in careers, unequal pay scales, and longer life expectancy, their retirement planning needs are unique. Inflation adds another layer of challenge: what costs ₹50,000 today could cost ₹1.6 lakh in 20 years.
NPS gives women a way to bridge these gaps. It’s not about being dependent on anyone, it’s about creating a future where you continue to live on your own terms.
What is NPS?
The National Pension System is a government-backed, low-cost, and portable retirement plan that builds wealth steadily through disciplined investments. It combines four asset classes—Equity (E), Corporate Bonds (C), Government Securities (G), and Alternative Investment Funds (A)—ensuring both safety and growth.
- With Active Choice, you can control how much goes into each asset. Up to 50 years of age, the maximum permitted Equity Investment is 75% of the total asset allocation.
- With Auto Choice, your allocation adjusts with age, ideal if you prefer a hands-off approach.
In short, NPS adapts to your comfort, whether you like making investment calls or prefer letting the system do the work.
Why is NPS a Smart Choice for Women?
- Affordable & Accessible – Among the lowest-cost pension products globally, NPS ensures that more of your money goes into building wealth, not into fees.
- Market-Linked Growth – With exposure to equities and bonds, NPS has historically delivered higher long-term returns.
- Exclusive Tax Benefits –
- Section 80C: Up to ₹1.5 lakh annually.
- Section 80CCD(1B): Exclusive tax benefits up to to Rs. 50,000 under section 80 CCD (1B) in addition to Rs. 1.5 lakhs under 80C.
- Section 80CCD(2): If your employer contributes to your NPS account, you can claim a deduction under Section 80CCD(2). It should not exceed 10% of your basic salary + DA under the old regime and 14% of your basic salary under the new regime. It is subject to a ceiling of Rs. 7.50 lakhs.
- Flexible & Portable – Whether you change jobs, take a break, or move cities, NPS stays with you.
- Supports Life’s Pauses – Even if you stop contributions temporarily (say, during a maternity break), your account and wealth keep growing.
How to Exit From NPS Scheme
- At Retirement (60 years):
- Withdraw 60% of your savings tax-free.
- Use 40% to buy an annuity (monthly pension).
- If corpus is under ₹5 lakh, you can withdraw 100%.
- If You Exit Early (before 60, after 5 years):
- 20% lump sum, 80% annuity.
- If corpus is below ₹2.5 lakh, withdraw 100%.
- Partial Withdrawals (after 3 years): Up to 25% of your contributions, for children’s education, marriage, healthcare, first house, or even starting your own venture. Tax-free.
Why Starting Early Changes Everything
Here’s the truth women often underestimate: time is your greatest financial asset.
- Start at 30 (₹10,000/month):
- Total invested: ₹36 lakh
- Retirement corpus at 60: ₹2.08 crore
- Start at 40 (₹15,000/month):
- Total invested: ₹36 lakh
- Retirement corpus at 60: ₹1.08 crore
The difference is striking, just a 10-year delay nearly halves your wealth, despite investing the same amount.
This is the power of compounding. For women, who often face interruptions in their careers, starting early means your money keeps working for you even when you can’t.
How to Open an NPS Account?
Here’s how you can easily open your NPS account:
- Locate Your Nearest Point of Presence (PoP): Visit nearest UTI Pension Fund Branch that assists with your NPS applications.
- Fill Out the Application Form: Complete the application form.
- Submit KYC Documents: Provide necessary identification documents as per KYC norms.
- Make Your Initial Contribution: Pay a minimum of ₹500 for a Tier 1 account.
- Submit Your Application: Hand in your completed application form.
- After submission, you will receive your PRAN kit via post within approximately ten days.
Conclusion
For women, financial independence doesn’t end with today’s paychecks, it extends into tomorrow’s peace of mind. The National Pension System (NPS) is more than just a pension scheme; it’s a commitment to yourself, ensuring that your hard work today guarantees freedom, dignity, and choice in retirement.
The best time to start was yesterday. The next best time is today. Secure your tomorrow, because a stress-free retirement is the ultimate form of independence.
Take charge now. Open your NPS account through UTI Pension Fund and let your money compound into lifelong confidence.
