Retirement Planning: People do not have any regular source of income after retirement, so it is important to plan for retirement now to have financial stability. If you do not want to invest due to market fluctuations, then the government also has many great savings schemes that can provide you financial security during retirement. These schemes provide financial security as well as many other benefits like regular returns and tax benefits. With the help of these schemes, you can create a balanced financial plan that can meet your lifestyle and health care needs after retirement.

Know which are the best government schemes

1. Employee Provident Fund (EPF)

EPF (Employees’ Provident Fund) is a retirement saving scheme for salaried employees. This scheme is very popular in India. In this scheme, the employee contributes 12% of his basic salary and dearness allowance and the employer i.e. the company also contributes the same amount every month. Out of the amount contributed by the company, 8.33% is deposited in the Employee Pension Scheme (EPS), and 3.67% is deposited in the Employee’s Provident Fund. This fund also receives annual interest and the interest rate is decided by the government, currently the current interest rate on this is 8.25%.

2. National Pension System (NPS)

NPS (National Pension System) is a market-linked retirement scheme that helps people to build a large corpus through diversified investments in equities, government bonds and corporate debt. The returns on this vary depending on the performance of the market. That is, there is no fixed return on this. Subscribers can claim tax benefits of up to Rs 1.5 lakh under section 80C and an additional Rs 50,000 under section 80CCD(1B).

3. Pradhan Mantri Vaya Vandana Yojana (PMVVY)

PMVVY (Pradhan Mantri Vaya Vandana Yojana) is a pension scheme designed for senior citizens aged 60 years and above. The aim of this scheme is to provide financial security to senior citizens in their old age. It gives a guaranteed return of 7.4% for 10 years. Market volatility does not affect the returns on this scheme, thereby providing financial security which is very important at this age. A maximum of Rs 15 lakh can be invested per person in this scheme. This scheme provides fixed monthly, quarterly or annual pension depending on the investment amount. On maturity, the principal amount is returned to the investor. In case of death of the investor during the policy term, the purchase price is paid to the nominee.

4. Senior Citizen Savings Scheme (SCSS)

SCSS (Senior Citizens’ Savings Scheme) is one of the highest interest paying schemes for senior citizens aged 60 years and above. The current interest rate on this scheme is 8.2%, which makes it an attractive option for such investors, Those who avoid investing money in the market due to the risk and want a fixed return on their investment. The maximum investment limit of this scheme is Rs 30 lakh. The tenure of this scheme is 5 years, which can be extended for an additional 3 years. The interest on this is paid on a quarterly basis, so that regular income is available.

5. Public Provident Fund (PPF)

PPF (Public Provident Fund) is a long term savings scheme, which currently offers an interest rate of 7.1%. It has a lock-in period of 15 years, which can be extended in blocks of 5 years each. It is necessary to invest at least Rs 500 annually, while the maximum investment limit is Rs 1.5 lakh annually. PPF is kept in the EEE (Exempt-Exempt-Exempt) category, which means that investment, interest and the amount received on maturity are all tax-free. Partial withdrawal and loan are allowed after five years. PPF is the right scheme for those who want tax efficient growth and are risk averse. Its long tenure and tax benefits make it an excellent option for retirement planning and wealth creation.

6. Atal Pension Yojana (APY)

Atal Pension Yojana (APY) is a pension scheme of the Government of India, which is for workers of unorganized sector and low income group. This scheme provides guaranteed pension after retirement. Subscribers can choose from fixed pension options ranging from Rs 1,000 to Rs 5,000 per month. The contribution in this scheme depends on the age of the subscriber and the pension amount. The government contributes 50% of the subscriber’s contribution (up to Rs 1,000) for five years for those who join before the age of 40. The minimum age to join this scheme (Atal Pension Yojana – APY) is 18 years and the maximum age is 40 years.