What is Atal Pension Yojana? Know how to apply

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Atal Pension Yojana (APY) is a government-backed pension scheme launched in 2015 under the Ministry of Finance. The scheme primarily targets the unorganised sector, providing financial security to workers during their retirement years. Here’s a detailed look at APY, its benefits, eligibility, and application process.

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WHAT IS ATAL PENSION YOJNA?

Atal Pension Yojana aims to offer a steady income to individuals after the age of 60, ensuring a secure retirement. It encourages low-income workers to save for their future through regular contributions. 

The scheme guarantees a fixed pension ranging from Rs 1,000 to Rs 5,000 per month, depending on the subscriber’s contribution and entry age.

Key highlights of the scheme:

1. Voluntary and Flexible: Subscribers can choose their contribution amount based on the desired pension.
2. Government Guarantee: The scheme ensures a fixed pension amount upon retirement.
3. Joint Pension Benefit: In case of the subscriber’s death, the spouse receives the pension, and upon the spouse’s demise, the nominee gets the corpus amount.

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WHO IS ELIGIBLE FOR THE ATAL PENSION YOJANA

To enrol in the APY, individuals must meet the following criteria:

1. Age Limit: The subscriber should be between 18 and 40 years.
2. Bank Account: A savings bank account is mandatory for the automatic deduction of contributions.
3. Income Category: Open to all citizens but especially beneficial for workers in the unorganised sector.
4. Exclusions: Individuals who are already paying income tax or covered under other statutory social security schemes may not benefit from the government co-contribution.

HOW TO APPLY FOR ATAL PENSION YOJNA?

Applying for APY is a simple process:

1. Step 1: Visit your nearest bank or post office offering the scheme.
2. Step 2: Fill out the APY registration form available at the bank.
3. Step 3: Provide your Aadhaar card, savings account details, and mobile number.
4. Step 4: Select the desired pension amount and authorise auto-debit from your account.

Alternatively, many banks offer online registration through their mobile apps or internet banking platforms.

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CONTRIBUTION AND PENSION DETAILS

• The contribution amount varies depending on the subscriber’s age and the desired pension amount.
• For example, a 20-year-old opting for a monthly pension of Rs 5,000 will contribute Rs 291 per month, whereas a 35-year-old would need to contribute Rs 902 monthly.
• Contributions are auto-debited, ensuring a hassle-free process.

BENEFITS OF ATAL PENSION YOJNA

1. Low Contribution, High Returns: Designed to be affordable for low-income groups.
2. Tax Benefits: Contributions are eligible for tax deductions under Section 80CCD.
3. Lifelong Security: Ensures a steady income for the subscriber and their family.
4. Flexible Exit Options: Partial withdrawal is allowed under specific conditions.

WHY CHOOSE ATAL PENSION YOJNA?

With rising uncertainties in income during old age, APY is a prudent financial tool, especially for individuals in the unorganised sector. It not only provides financial independence but also ensures a dignified life post-retirement.