NPS is a powerful retirement plan that accompanies you every step of the way. Even if you change jobs or become an NRI, your PRAN (Permanent Retirement Account Number) never changes, ensuring your deposited funds are 100% safe. Learn how you can keep your NPS account active, continue investing, and enjoy tax-free retirement benefits even after changing jobs or moving abroad.
No Impact on NPS Funds Upon Job Change
Changing jobs for career growth is common these days, but many investors wonder if changing jobs will affect their NPS funds or require them to open a new account. The simple answer is—absolutely not.
The Importance of a Permanent PRAN Number
The entire NPS system rests on a unique Permanent Retirement Account Number (PRAN). This number never changes, so there’s no need to open a new account upon joining a new job. If your new company offers Corporate NPS, you can simply link your old PRAN. If this is not the case, you can continue to deposit funds manually through the e-NPS portal or through your bank.
According to media reports, PRAN ensures that the account remains valid. Changing jobs does not impact the NPS corpus. Your funds remain safe with your chosen fund manager, and the asset allocation remains the same. If your salary increases, you can increase your voluntary contributions to reach your retirement goals even faster.
Continuing to invest in NPS even if you move abroad
If you move abroad for better opportunities and become an NRI (Non-Resident Indian), you can continue to invest in NPS, making it the most flexible retirement product.
Contribution Requirements for NRIs
To continue investing as an NRI, you must have an NRE or NRO account. Contributions can only be made in Indian rupees. You’ll also need to update your KYC, which requires you to provide your passport, proof of foreign address, and an FTCA/CRS declaration.
Even if you’re permanently settled abroad, your account can remain valid until you reach the age of 60. After that, you can withdraw funds through your bank account. According to Ajay Kumar Yadav, NPS is the easiest, most affordable, and most systematic retirement product available to both residents and NRIs.
The Best Option for Retirement
NPS is a completely portable plan, meaning you can transfer it seamlessly to any corner of the country or throughout your career path, making it a constant companion in growing your savings. NPS matures at the age of 60.
Upon maturity, 60% of the total funds are tax-free, and the remaining 40% is used to purchase an annuity, which provides you with a regular pension. If you withdraw before age 60, you can withdraw up to 20% of your corpus in a lump sum, and 80% of your corpus must be used to create an annuity. For all these reasons, NPS is considered one of the most promising and safest retirement options.