NPS Vatsalya Yojana: How Rs 1,000 monthly investment can grow to Rs 10 crore

The Indian government launched the NPS Vatsalya Yojana, a pension scheme for children. Announced in the 2024 Union Budget, it encourages parents to save for their children's future and accumulate long-term wealth. With a minimum annual contribution of Rs 1,000, it's accessible to all.

Over 250 Permanent Retirement Account Numbers (PRANs) have been issued, making it accessible to families across financial levels. The scheme emphasizes the power of compound interest, offering the potential for substantial financial growth. Flexible contribution options ensure affordability.

Continued until age 60, the estimated corpus could grow to Rs 2.75 crores at a 10% return rate, or even higher. This not only secures a child's future but also promotes disciplined saving habits, aligning with the government's financial security goals.

Parents/guardians contribute, and the account seamlessly transitions to a regular NPS account at age 18. Withdrawals up to 25% are allowed after three years for emergencies. At maturity, corpus usage depends on the amount.

Required documents include the child's birth certificate and guardian's ID. If the guardian is an NRI, an NRE/NRO account in the minor's name is mandatory. The scheme also includes provisions for emergencies.