As the government of India was concerned with regards to the income security for the old age and focused upon encouraging and helping to save for retirement.
Addressing the longevity risks amongst the unorganized sector workers and encouraging the same to save for the retirement voluntarily. The government of India introduced a new scheme known as the ‘Atal Pension Yojana’. The Atal Pension Yojana was launched on 09th June 2015 and is duly administered by Pension Fund Regulatory and Development Authority.
Atal Pension Yojana is the pension scheme that focuses mainly at the unorganized sector like the delivery boys, maids, gardeners and so forth. The Atal Pension Yojana replaced the earlier Swavalamban Yojana.
The key objective of the Atal Pension Yojana is to ensure that no citizen of India worries about any accident, illness, ailments in old age, and so forth and assures a sense of security. Any private-sector employees or the employees working with any such organization, which do not provide pension benefit might also apply for the scheme.
Besides, there is an alternative of getting the fixed pension of a sum of Rs 1000, Rs 2000, Rs 4000, Rs 3,000 or Rs 5,000 after attaining 60 years of age. The pension is determined on the premise of the age of an individual and the sum of contribution. The spouse of the contributor can easily claim the pension on the demise of the contributor and in case of demise of both the spouse and the contributor the nominee will receive the accumulated corpus. In case the contributor passes away before 60 years then the spouse is given an alternative to either continue the scheme for a balanced period or claim the corpus and exit the scheme.
We know that the scheme will be managed by the PFRDA, and the government also make the co-contribution of 50 per cent of the complete contribution or simply Rs 1,000 each annum whatever is lower to the subscribers who joined the Atal Pension Yojana scheme between June- December 2015, for a term of 5-years. The subscribers should not be part of any statutory social security schemes, for instance, employees provident fund and also not be paying income taxes to avail the co-contribution of the government.
To avail the advantages of the Atal Pension Yojana, the following key requirements need to be fulfilled:
Anyone availing the advantage of Swavalamban Yojana will be registered automatically to the Atal Pension Yojana.
Let us take a brief understanding of the benefits of Atal Pension Yojana listed below:
Note: The tax benefits are subject to change in the prevailing laws in India.
To avail the benefits of the Atal Pension Yojana, follow the steps mentioned below:
Whenever the application is approved, a confirmation message will be sent.
The monthly contributions are on the premise of the sum of pension that one wishes to receive upon the retirement and also at the age when one initiates contributing. The table below shows the contribution that needs to be done per annum on the premise of the age and the pension plan:
Entry Age |
Contribution Years |
Monthly Pension of Rs 5000 Indicative Return of the Corpus of Rs 8.5 lakh |
Monthly Pension of Rs 5000 Indicative Return of the Corpus of Rs 6.8 lakh |
Monthly Pension of Rs 5000 Indicative Return of the Corpus of Rs 5.1 lakh |
Monthly Pension of Rs 5000 Indicative Return of the Corpus of Rs 3.4 lakh |
Monthly Pension of Rs 5000 Indicative Return of the Corpus of Rs 1.7 lakh |
18 years |
42 |
210 |
168 |
126 |
84 |
42 |
19 years |
41 |
228 |
183 |
138 |
92 |
46 |
20 years |
40 |
248 |
198 |
150 |
100 |
50 |
21 years |
39 |
269 |
215 |
162 |
108 |
54 |
22 years |
38 |
292 |
234 |
177 |
117 |
59 |
23 years |
37 |
318 |
254 |
192 |
127 |
64 |
24 years |
36 |
346 |
277 |
208 |
139 |
70 |
25 years |
35 |
376 |
301 |
226 |
151 |
76 |
26 years |
34 |
409 |
327 |
246 |
164 |
82 |
27 years |
33 |
446 |
356 |
268 |
178 |
90 |
28 years |
32 |
485 |
388 |
292 |
194 |
97 |
29 years |
31 |
529 |
423 |
318 |
212 |
106 |
30 years |
30 |
577 |
462 |
347 |
231 |
116 |
31 years |
29 |
630 |
504 |
379 |
252 |
126 |
32 years |
28 |
689 |
551 |
414 |
276 |
138 |
33 years |
27 |
752 |
602 |
453 |
302 |
151 |
34 years |
26 |
824 |
659 |
495 |
330 |
165 |
35 years |
25 |
902 |
722 |
543 |
362 |
181 |
36 years |
24 |
990 |
792 |
594 |
396 |
198 |
37 years |
23 |
1087 |
870 |
654 |
436 |
218 |
38 years |
22 |
1196 |
957 |
720 |
480 |
240 |
39 years |
21 |
1318 |
1054 |
792 |
528 |
264 |
40 years |
20 |
1454 |
1164 |
873 |
582 |
291 |
Take a look at the following important information in regards to the Atal Pension Yojana:
Wrapping it Up
Gone are the days when only the middle class could enjoy the benefits of pension plans and create a safe retirement nest. The Atal Pension Yojana is an effort to provide financial protection to the working class of the unorganized sector. This scheme also enables to save the corpus for the old-age.