The Pension Fund Regulatory and Development Authority (PFRDA) has expanded the number of investment options available under the National Pension System (NPS)
and the Unified Pension Scheme (UPS). Two new auto-choice options have been introduced, increasing the total investment choices for Central Government (CG) subscribers from four to six.
The newly added options are:
Auto Choice – Life Cycle 75 – High (15E/55Y)
Auto Choice – Life Cycle – Aggressive (35E/55Y)
With these additions, government employees will now have more flexibility in selecting investment styles based on their risk appetite and long-term financial goals.
Contents
Existing Investment Options for Central Government Subscribers
Currently, CG subscribers under NPS and UPS have access to the following four options:
Default Scheme:
Contributions are invested according to a fixed asset allocation pattern managed by three pension funds.
Active Choice (100% G-Sec):
Investments are made entirely in Government Securities.
Auto Choice – Life Cycle 25 – Low (5E/55Y):
25% of the contribution is invested in equities until age 35, gradually reducing to 5% by age 55 and continuing at that level until exit.
Auto Choice – Life Cycle 50 – Moderate (10E/55Y):
50% equity allocation until age 35, reducing to 10% by age 55 and remaining so till exit.
Details of the New Investment Options
Auto Choice – Life Cycle 75 (High)
75% of the contribution goes to equities until the subscriber turns 35.
Equity allocation gradually reduces to 15% by age 55.
This option suits subscribers willing to take higher market-linked risks for potentially higher long-term returns.
Auto Choice – Life Cycle – Aggressive
50% of contributions are invested in equities until age 45.
The equity portion reduces to 35% by age 55.
This option maintains a higher equity exposure than existing plans and is ideal for those seeking a growth-oriented portfolio during mid-career.
Important Advice for Subscribers
PFRDA recommends that subscribers evaluate the performance of each scheme and review the track record of pension funds before making any changes.
Updated return data for all schemes and funds can be found on the NPS Trust website.