Taxpayers will not be able to invest in the Atal Pension Scheme from October 1, 2022. The government is going to close the Atal Pension Scheme for taxpayers. A notification in this regard was issued on August 10.
The Atal Pension Scheme or APY is a scheme in which one can get a guaranteed pension after 60 years by depositing a nominal amount. In this scheme, there is a provision to give a minimum monthly pension of Rs 1000 (Rs 12,000 per annum) and a maximum of Rs 5,000 (Rs 60,000 per annum).
So, if you are a taxpayer and want to get a pension of up to Rs 5,000 after the age of 60, you can apply for the Atal Pension Scheme by September 30 or before October 1. After that, you will not get the opportunity. For young people in the age group of 20-30, a pension of Rs 5,000 in APY may seem decent. But it has many features. The first thing is that it is a guaranteed pension which will definitely be deposited in your account in the form of a fixed amount every month.
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The second special thing is that it is completely different from the National Pension System i.e. NPS, where there is a provision for two separate accounts. You cannot withdraw the entire amount at once and have to buy an annuity scheme.
Another special thing, in the rest of the pension schemes, you have to deposit a single or large amount sequentially, then the pension fund is collected. This is not the case with Atal Pension because here one can get a guaranteed pension by depositing a few rupees.
Pension is given for life in Atal Pension Scheme. After the death of the subscriber, his wife (or husband) is given the same amount as pension. If the wife also dies, the entire amount is returned to the nominee which was deposited in the APY account. Let us tell you how you can take maximum advantage of this scheme.
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Let’s say, a 30-year-old person keeps on paying Rs 577 per month (Rs 6,924 per annum) for 30 years. When the subscriber turns 60, he will be entitled to a pension of Rs 5,000 per month (Rs 60,000 per annum). Let the person live till 90 years. Thus, he will get pension for 30 years.
If you are close to 40 years, then the maximum age to invest in APY is 40 years. This means that you can invest in this scheme till the age of 40 years and 364 days. Thus, if you are close to this age, you will have to invest for at least 19 years. For example, a person who starts investing at the age of 40 years will have to invest in APY for 20 years. For a pension of Rs. 5,000, the monthly contribution amount will be Rs. 1,454.
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A customer who opts for a monthly pension of Rs. 5,000 at the age of 18 years will have to contribute Rs. 210 every month for 42 years. Similarly, a customer who opts for a monthly pension of Rs. 5,000 at the age of 24 years will have to contribute Rs. 346 every month for 36 years.