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All about Atal pension yojana & how it provide maximum benefits, with minimum investment.

The government has launched the Atal pension Yojana back in Jun’2014,  it is a statutory social security scheme, as the government of India is very concerned about the old age income security of poor working peoples India, such scheme has been introduced.

So let understand Atal pension yojana is & why we need this?

What is the meaning of the Pension?

As per Oxford Dictionary, “Pension is a regular payment made by the state to people of or above the official retirement age or no longer working”.

Atal Pension Yojana  & Its Need

Atal pension Yojana is a statutory social security scheme, which ensures guaranteed pension amount of Rs. 1,000 to Rs. 5,000 depending upon the Period & amount of contribution by the person.
The main purpose of introduction of the scheme was to cover the unorganized sector of India two generally not opt. for any pension scheme.

Why people not opting for any Pension scheme?

1.  In India, there is 21.9 percent population (as per the census of 2011)are living below the poverty line, which means even they are struggling to earn there basic live hood.

2. A major section of our society is just above the poverty line or just able to survive & not having enough saving to opt for any pension scheme.

3. Resulting once they are growing old then either they become dependent on their children or toil hard for bread & butter even in this age.

3. As per the latest data by Business standard,s, there is 77 percent of the population have been not opted for any pension scheme.

4. Right now India is called the country of Youths but by the year 2031, the age limit of people more than 65 year age will grow with increasing rates i.e. 75% of higher than the current rate.

Benefits of Atal pension yojana

Fixed pension for the subscribers ranging between Rs. 1000 to Rs. 5000, if he joins and contributes between the age of 18 years and 40 years.

The benefit of minimum pension under Atal Pension Yojana would be guaranteed by the Government in the sense that if the actual realized returns on the pension contributions are less than the assumed returns for minimum guaranteed pension, over the period of contribution, such shortfall shall be funded by the Government.

On the other hand, if the actual returns on the pension contributions are higher than the assumed returns for minimum guaranteed pension, over the period of contribution, such excess shall be credited to the subscriber’s account, resulting in enhanced scheme benefits to the subscribers.

The Government would also co-contribute 50% of the total contribution or Rs. 1000 per annum, whichever is lower, to each eligible subscriber, who joins the scheme during the period 1st June, 2015 to 31st March, 2016 and who is not a beneficiary of any social security scheme and is not an income tax payer, such government contribution given for the five year from year 2015 to 2020.

At present, a subscriber under the National Pension System (NPS) is eligible to get the tax benefit for the contribution, up to a ceiling under section 80C of Income tax act,1961, and even for the investment returns on such contributions.
The fixed amount of money will be credited to your bank account every month after you reach the age of 60 years.

Anyone can join this plan that is not covered under any other social security plan. So provides access to a social security scheme.

The premium or the monthly contribution is very low.

The penalty is also very low like Re 1 to Rs. 10 that’s it.

Government is also going to contribute 50% of the investment Initially from 2015 to 2020. So it is subsidized.

With all this, we can say that is the scheme which provides maximum benefits with minimum investment.

Who are eligible to join?

The first criterion is you must be a citizen of India if you are looking for joining the Atal Pension Yojana.

Citizens who want to join this scheme must have a valid bank account because all the money transfer like the contributions and returns will be done through direct bank transfer.

Now let us talk about the Age factor. The edibility age is 18  to 40 years. So after 40 years of age, you cannot join this scheme

The age factor is very important because monthly contribution would depend upon how early you join the scheme. We will talk about this in detail in the coming paragraphs.

You will get government contribution only if you are not part of any other social scheme and also you are not a taxpayer. Then the government can contribute for you.

Following are the charges for default in the payment of the monthly premium

Banks are required to collect an additional amount for delayed payments, such amount will vary from minimum Re 1 per month to Rs 10/- per month as shown 

• Re. 1 per month for a contribution up to Rs. 100 per month.

• Re. 2 per month for a contribution up to Rs. 101 to 500/- per month.

• Re 5 per month for contribution between Rs 501/- to 1000/- per month.

• Rs 10 per month for contribution beyond Rs 1001/- per month.

The fixed amount of interest/penalty will remain as part of the pension corpus of the subscriber.

Is Exit possible after opting for pension scheme?

Yes, Following are the circumstances where exit possible:

1.On attaining the age of 60 years:

The exit from APY is permitted at the age with 100% annuitisation of pension wealth. On exit, a pension would be available to the subscriber.

 2. In case of death of the Subscriber due to any cause:

In case of death of subscriber pension would be available to the spouse and on the death of both of them (subscriber and spouse), the pension corpus would be returned to his nominee.

 3. Exit Before the age of 60 Years:

Exit before 60 years of age is not permitted however it is permitted only in exceptional circumstances, i.e., in the event of the death of a beneficiary or terminal disease.

Further if Voluntary exit from Atal pension Yojana, In case a subscriber, who has availed Government co-contribution under APY, chooses to voluntarily exit APY at a future date, he shall only be refunded the contributions made by him to APY, along with the net actual accrued income earned on his contributions (after deducting the account maintenance charges). The Government co-contribution and the accrued income earned on the Government co-contribution shall not be returned to such subscribers.

How to apply for Atal pension Yojana?

1. Approach the bank branch where an individual’s savings bank account is held.

2. Fill up the APY registration form (get the Registration form copy by following the below-mentioned link)

3. Provide Aadhaar number or any previously registered without Aadhar in such case Aadhar seeding is required/Mobile Number

4. Ensure keeping the required balance in the savings bank account for the transfer of monthly contribution.

5. One can apply online also but for that having a saving bank account is important.

Contribution chart & return:

Find below the Link to apply online:

Get Pdf copy of Application form to apply:

Get Aadhar consent form (for seeding of Aadhar with APY account):

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