How does NPS withdrawal at retirement work?
Both Employees' Provident Fund (EPF) and National Pension System (NPS) are government-backed retirement schemes, but differ on several counts. EPF offers assured returns, with the interest rate declared by the EPFO every year. At retirement, you can withdraw your entire PF balance, besides drawing pension. NPS offers market-linked returns through its equity, corporate debt and government securities funds. Once you turn 60, you can withdraw 60 percent of the corpus as lump-sum. You have to mandatorily use 40 percent of your corpus to buy annuitiesregular, lifetime pension. However, this is not the case if the corpus size is under Rs 5 lakh. Then the entire amount can then be withdrawn at one go.