What is the Atal Pension Scheme? Atal Pension Yojana is a government-supported voluntary pension scheme for the citizens of India, which provides a monthly income to old people not working. It is specifically targeted at the poor, the disadvantaged, and unorganised-sector workers. Under this scheme, a minimum guaranteed pension of Rs 1,000, Rs 2,000, Rs 3,000, Rs 4,000 or Rs 5,000 per month will commence for the subscribers after attaining the age of 60 years, depending on the contribution made towards the pension amount chosen by him/her.
What is the need for a pension:
According to the official website,
- Decreased income-earning potential during old age.
- Increased Life-Expectancy.
- Tenure of retired life is almost the same as working life.
- Rise in cost of living/Inflation.
- Migration of earning members.
- The rise of the culture of the nuclear Family.
- A dignified life in old age due to less financial dependence.
10 Key things to know about the Atal Pension Yojana (APY):
1. Who can apply for APY?
Any Indian citizen between 18 and 40 years old can join the Atal Pension Yojana, provided they have a savings account with a bank or post office.
2. Who is not eligible?
Since October 1, 2022, people who are income-tax payers at the time of applying cannot open a new APY account. This rule applies even if they paid income tax only once in the past.
3. How can you open an APY account?
You can visit the bank or post office where you already have a savings account and apply for APY there. If you do not have a savings account yet, you’ll need to open one first.
4. How long do you need to contribute?
Subscribers are required to make regular contributions until they turn 60 years old. The earlier you join, the lower your contribution amount will generally be.
5. Mode of contribution
Contributions can be made monthly, quarterly, or half-yearly through the auto-debit facility linked to the subscriber’s savings bank or post office savings account.
6. Pension benefits for the spouse
In case of the subscriber’s death, the spouse is entitled to receive the same pension amount that the subscriber was receiving, until the spouse’s death.
7. Benefits for the nominee
After the death of both the subscriber and the spouse, the nominee will receive the pension wealth accumulated in the account up to the subscriber attaining 60 years of age.
8. Only one APY account is allowed
An individual can open only one APY account. Holding multiple APY accounts is not permitted under the scheme.
9. APY accounts for family members
Every eligible family member between the ages of 18 and 40 can open their own separate APY account. However, minors are not allowed to open an APY account.
10. Eligibility of NRIs and future taxpayers
NRIs who meet the eligibility conditions can also open an APY account. Additionally, a person should not be an income-tax payer at the time of applying for APY. If the subscriber becomes an income-tax payer later, the APY account will continue without any impact, and the subscriber can keep contributing to receive the scheme benefits.
