Starting early: Pension a/cs for children

Starting early: Pension a/cs for children 

TIMES NEWS NETWORK  19.09.2024 

New Delhi : Now parents can start planning for the long-term financial security of their children, setting the foundation even for their retirement. Implementing the FY25 Budget announcement, finance minister Nirmala Sitharaman on Wednesday launched the NPS Vatsalya, a pension scheme for minors. The scheme was launched simultaneously at 75 locations throughout the country, and over 250 PRANs (permanent retirement account numbers) were handed over to minor subscribers.

 FM said NPS Vatsalya is a significant step in govt’s endeavour to promote longterm financial planning and security for all citizens. Besides securing the future of subscribers, the scheme is based on the principle of intergenerational equity by providing cover to older and young members of the family. “My appeal to all parents is that when you attend a child’s birthday party, you can take cakes or other gifts, but money to invest in NPS Vatsalya will also be a form of gift. It will be a lifelong contribution to the child’s future,” 

Sitharaman said. the scheme will inculcate the habit of savings among young subscribers, and large wealth can be accumulated through the power of compounding. She asserted that the scheme will allow a dignified life to people in their old age. Nagaraju Maddirala, secretary, department of financial services (DFS), urged all stakeholders, including banks, for effective implementation and outreach of the NPS scheme. He said efforts are being made to include more workers from the informal sector into the pension fold. Deepak Mohanty, chairperson, PFRDA, said for pensions, an early start is a head start: small amounts squirrelled away could yield a substantial corpus by harnessing the power of compounding.