Atal Pension Yojana Extended Until 2031, Guaranteeing Old Age Income

Atal Pension Yojana: The Central Government has decided to continue the Atal Pension Yojana (APY) until the financial year 2030-31. The proposal was approved in a recent Union Cabinet meeting. The government states that this scheme provides reliable support for old age for millions of people working in the unorganized sector. Under the scheme, a guaranteed pension of ₹1,000 to ₹5,000 is provided every month after the age of 60.

Why was the Atal Pension Yojana launched?

The Atal Pension Yojana was launched in 2015. Its purpose was to provide pension security to those engaged in private jobs, daily wage labor, small businesses, or self-employment. These occupations lack a regular income after retirement. The government wanted every citizen to receive at least a fixed income in old age, enabling them to live a respectable life.

How the Atal Pension Yojana works

Individuals enrolled in this scheme are required to deposit a fixed amount every month until they reach the age of 60. This amount is determined by their age and the pension chosen. Upon reaching 60, the government transfers the monthly fixed pension directly to their bank account. The pension amount can be chosen from ₹1,000, ₹2,000, ₹3,000, ₹4,000, or ₹5,000.

Who can join this scheme?

Only those between the ages of 18 and 40 are eligible for the Atal Pension Yojana. Applicants must have a bank account linked to Aadhaar. This scheme is specifically designed for low-income individuals, so those under the income tax bracket are not eligible.

Who will not benefit from the scheme?

If a person is over 40 or under 18, they cannot apply for this scheme. Additionally, those who already pay income tax cannot join this scheme. Those without a bank account or an Aadhaar-linked account will also be unable to benefit from this scheme.

What the Mathematics of Investment and Pension Says

The contribution amount to the Atal Pension Yojana depends on age. If a person joins the scheme at the age of 18 and wants a pension of Rs. 5,000 per month after 60, they must deposit approximately Rs. 210 per month. If someone joins at the age of 30, they will have to pay approximately Rs. 577 per month for the same pension. The monthly contribution also increases with age.

Who Will Benefit from the Government’s Decision?

The extension of the scheme’s duration will benefit those who have not yet joined. Additionally, young people working in the unorganized sector will have more time to plan for their future financial security. The government believes that this decision will strengthen social security.