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Atal Pension Yojana (APY) : Eligibility, Benefits and How to Enroll

Team AckoJul 13, 2023

In today's world, it is crucial to plan for your retirement to ensure a secure and comfortable future.

The Atal Pension Yojana (APY) is a pension scheme for providing financial stability to the unorganised sector and ensuring their well-being during their golden years.

In this article, we will delve deep into the workings of the Atal Pension Yojana, its benefits, eligibility criteria, and how you can enrol in the scheme to secure your retirement.

Contents

Atal Pension Yojana: An overview
Eligibility Criteria
Key features of Atal Pension Yojana
Benefits of Atal Pension Yojana
How to Enrol in Atal Pension Yojana?
Wrapping up
Frequently Asked Questions

Atal Pension Yojana: An overview

Atal Pension Yojana, launched by the Government of India in 2015, aims to provide a sustainable pension system for citizens of India working in the unorganised sector.

This voluntary scheme offers a guaranteed minimum pension amount to subscribers based on their contribution and age at the time of joining the scheme.

The scheme is administered by the Pension Fund Regulatory and Development Authority (PFRDA) and operates under the guidance of the Ministry of Finance.

Eligibility Criteria

To be eligible for the Atal Pension Yojana, an individual must meet the following criteria.

The age should be between 18 and 40 years.
The subscriber must have a savings bank account.
Aadhaar will be its primary KYC.
If not available at the time of account opening, Aadhaar details can be submitted later.
The subscriber should not be covered under any statutory social security scheme.

Key features of Atal Pension Yojana

Atal Pension Yojana was established by the Government of India to provide guaranteed monthly pension to all Indians after the age of 60 years. Here are some key features of this scheme.

Its targets are mainly the poor, the underprivileged and the workers in the unorganised sector. It is regulated by the PFRDA (Pension Fund Regulatory and Development Authority) through the NPS (National Pension System) structure.
Rs.1000 5000 to Rs. Guaranteed minimum monthly pension for subscribers between (in multiples of 1000) per month.
The Indian Government will ensure that the minimum pension amount is protected. This means that if the pension contributions do not yield the expected return to meet the minimum guaranteed pension, the Government will provide the necessary funds to cover the shortfall.
If the real return on pension contributions exceeds the anticipated return for the minimum guaranteed pension, the surplus will be added to the subscriber's account during the contribution period. As a result, this will increase the benefits provided by the scheme to the subscribers.

Benefits of Atal Pension Yojana

The Atal Pension Yojana offers several benefits to its subscribers, making it a good choice for people in the unorganised sector. Let's explore some of the key benefits.

Guaranteed Pension: The program offers a consistent retirement income by granting a set pension amount between Rs. 1,000 and Rs. 5,000 per month. The actual sum depends on the subscriber's age and contribution, ensuring a steady stream of income throughout their retirement years.
Flexible Contribution: Subscribers can choose their monthly contribution amount based on their desired pension amount. The contribution ranges from Rs. 42 to Rs. 1,454, offering flexibility to individuals with varying income levels.
Government Co-contribution: To encourage people to join the scheme, the government provides a co-contribution of 50% of the subscriber's contribution or Rs. 1,000 per year (whichever is lower) for a period of five years to eligible subscribers.
Tax Benefits: Contributions made towards the Atal Pension Yojana are eligible for tax benefits. This allows subscribers to save on their tax liabilities while building a retirement corpus.

How to Enrol in Atal Pension Yojana?

Enrolling in the Atal Pension Yojana is a simple and hassle-free process. Follow the steps below to get started.

Visit your nearest bank or post office that offers the Atal Pension Yojana.
Fill out the APY enrollment form, providing accurate personal and bank account details.
Choose the pension amount and contribution frequency.
Provide consent for auto-debit of the contribution amount from your bank account.
Ensure sufficient funds are available in your account for the contribution to avoid any penalties.

Wrapping up

Planning for retirement is a crucial step towards securing a financially independent future.

The Atal Pension Yojana offers an excellent opportunity for individuals in the unorganised sector to build a retirement corpus and ensure a regular income during their golden years.

With its flexible contribution options, government co-contribution, and tax benefits, the scheme has gained significant popularity since its inception.

Enrol in the Atal Pension Yojana today and take a proactive step towards securing your future.

Frequently Asked Questions

Here are some common questions about the Atal Pension Yojana.

What is the minimum age to opt for the Atal Pension Yojana?

The minimum age to opt for the Atal Pension Yojana is 18 years. Individuals who are 40 years old or below can enrol in the scheme.

Is it mandatory to have a savings bank account to join the Atal Pension Yojana?

Yes, it is mandatory to have a savings bank account to enrol in the Atal Pension Yojana. The contributions and pension amounts are directly linked to the subscriber's bank account.

Can I increase or decrease my contribution amount after joining the scheme?

Yes, subscribers have the flexibility to increase or decrease their contribution amount once a year during the month of April. This allows individuals to adjust their savings as per their financial situation.

What happens if I miss a contribution?

If a subscriber misses a contribution, a penalty will be levied for the delayed payment.

Can I withdraw from the Atal Pension Yojana before the retirement age?

Premature exit from the Atal Pension Yojana is possible only in exceptional circumstances such as critical illness or death. In such cases, the accumulated corpus will be paid to the subscriber's nominee.

Is there a provision for a joint account under the Atal Pension Yojana?

No, the Atal Pension Yojana does not have a provision for a joint account. Each individual must enrol separately to avail the benefits of the scheme.

Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making any related decisions.