NPS: Annuity plan without return of purchase price maximises payout

Go for joint life plan if you have dependent spouse

- SAIKAT NEOGI

NATIONAL PENSION SYSTEM (NPS) investors need to choose the annuity plan wisely as the interest rate is fixed for life. In case the pensioner's children are financially well-settled, he can opt for non-return of purchase price to benefit from maximum payout. For those looking to leave a legacy, joint life return of purchase price option is ideal.

In NPS, at the time of maturity the subscriber has to buy annuity for at least 40% of the corpus. The annuity returns will vary depending on the type of annuity plan opted by the investor, yield offered by the life insurance company and the frequency of the payout —monthly, quarterly, half-yearly or annual.