NPS: Experts say that it should be treated like SIP and like mutual funds, its negative return on investment is also temporary. He says that people should pay attention to its benefits.
new Delhi. Although there are many benefits of investing in the National Pension System (NPS), but due to the market-linked scheme, many times the returns start coming in negative. This makes many investors nervous and start reducing their contribution to NPS. Is it right to do so, or should investors keep their investment stable without fear. What do experts say about this, today we are going to tell you this in this article.
National Payment System is a scheme supported by the government. By investing in it, you get 2 benefits after maturity. One is that you take home 60 per cent of the funds generated together. Second, you have to buy an annuity from 40 per cent. Annuity can also be called pension. You get this every month, 3 months, 6 months or on an annual basis. With this, your financial condition remains sound after retirement. NPS is a market linked scheme, so there is some risk in it but the returns are also tremendous.
What is the reason behind the negative return?
Now let’s talk about the issue for which you have come here. You will not always get strong returns in NPS. In the period of market decline, there will be a decline in the returns of NPS. Satya Nadella, MD and CEO of Kfintech, writes that in the last few years, the way mutual funds are giving negative returns, almost the same situation has happened with NPS. However, he says that there is no need to scare investors from this. He says that equity and debt markets have underperformed in recent times, so you should keep increasing your investment in NPS. He believes that people should look at NPS just like a SIP. According to Nadella, the main reason for the decline in the returns of MFs in recent times is the market leaning towards large cap stocks. He said that whenever this happens in the market, schemes related to equity tend to go down.
What should investors do
He says that investors should not panic due to the ups and downs in the market and should maintain their investment in NPS. He said that instead of worrying about the decline in NPS returns, keep investing keeping in mind its benefits so that you do not have to worry about money in future.
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