Finance Minister Nirmala Sitharaman Launches NPS Vatsalya Yojana for Children’s Future
New Delhi, September 18: Union Finance Minister Nirmala Sitharaman has introduced the NPS Vatsalya Yojana, a new scheme aimed at helping parents and guardians save for their children’s future. Announced in this year’s union budget, the scheme allows parents to make flexible contributions starting from Rs. 1,000 annually in the child’s name.
Key Features of NPS Vatsalya Yojana
- Open to all minor citizens up to 18 years old.
- Minimum annual contribution of Rs. 1,000.
- Accounts can be opened through banks, post offices, pension funds, or online via the eNPS platform.
- After the age of 18, the account converts to a regular NPS Tier I account.
During the launch, Sitharaman emphasized the importance of saving for children’s futures and suggested that contributions to NPS Vatsalya could be a meaningful gift for birthdays and other celebrations.
Unified Pension Scheme for Government Employees
Sitharaman also mentioned the recently approved Unified Pension Scheme (UPS) for central government employees, effective from April 1, 2025. The UPS combines elements of the Old Pension Scheme (OPS) and the New Pension Scheme (NPS), offering a guaranteed pension of 50% of the average basic pay from the last 12 months before retirement, along with inflation indexation.
The Finance Ministry highlighted that the launch of NPS Vatsalya demonstrates the government’s commitment to promoting long-term financial planning and security for all citizens.
Doubts Revealed
Finance Minister -: The Finance Minister is a person in the government who is responsible for managing the country’s money, like how much to spend and save. In India, this person is Nirmala Sitharaman.
Nirmala Sitharaman -: Nirmala Sitharaman is a leader in the Indian government who takes care of the country’s finances. She helps decide how the government should spend and save money.
NPS Vatsalya Yojana -: NPS Vatsalya Yojana is a new plan started by the government to help parents save money for their children’s future. Parents can put in money every year, starting from Rs. 1,000.
Union Finance Minister -: The Union Finance Minister is the main person in charge of the country’s finances at the national level. In India, this role is held by Nirmala Sitharaman.
Minors -: Minors are children who are under 18 years old. They are not yet adults and need their parents or guardians to make important decisions for them.
Unified Pension Scheme -: The Unified Pension Scheme is a plan for government employees to get a regular income after they retire. It will start from April 1, 2025, and will adjust for inflation, which means it will keep up with the rising cost of living.
Inflation indexation -: Inflation indexation means adjusting the amount of money people get so it keeps up with the rising prices of things. This helps make sure that the money they receive is still valuable over time.
Government employees -: Government employees are people who work for the government, like teachers, police officers, and office workers. They help run the country and provide services to the public.
Long-term financial planning -: Long-term financial planning means making plans to save and spend money wisely over many years. This helps ensure that people have enough money for important things in the future, like education or retirement.