NPS Vatsalya Scheme : Are you worried about your child’s future? If you want to save some big money for children despite your low income, then this scheme will be useful for you. By investing Rs 834 every month in this government scheme, you can save Rs 11 crore for children. The central government has launched the NPS Vatsalya scheme in September 2024, which can convert small investments into crores.
The purpose of this scheme is to provide middle and low income families an easy way to invest in the name of children, so that they can create a strong fund at the time of retirement.
How does the scheme work?
Under this scheme, any parent can invest Rs 834 per month or Rs 10,000 per year in the name of their child below 18 years of age. If this investment is made continuously and the child continues to invest till the age of 60, then the fund can reach around Rs 11 crore. This estimate is when the average return of the investment is 12.86% per annum, which can be possible in the Aggressive Investment Option of the scheme.
Who can get benefit?
- The child should be below 18 years of age.
- He must have PAN card and Aadhar card.
- As soon as the child turns 18, his account will be converted into NPS Tier-1 Account.
How much amount can you start with?
- You can start with Rs 1,000 per annum.
- There is no maximum investment limit, meaning you can increase your investment as your income increases.
- Investment Options – Choose as per your Risk
- Aggressive Mode – 75% in stock market (high risk, high profit)
- Moderate Mode – 50% in stock market (moderate risk, balanced profit)
- Conservative Mode – 25% in stock market (low risk, stable returns)
Apart from this, there is also Active Choice, where you can decide yourself how much money should go into equity and how much into debt. If a parent starts investing Rs 10,000 annually when a child is born, they can earn this much money at the returns given below.
12.86% return – Rs 11 crore
11.59% return – Rs 5.97 crore
At 10% return – Rs 2.75 crore
Though these are estimates, actual returns will depend on market movements and your investment strategy.
Facility to withdraw money at the time of need
After 3 years, up to 25% of the total investment can be withdrawn. This money can be used for necessary expenses like education, treatment or disability. This facility is given a total of 3 times.