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How much is too much NPS contribution using credit card

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Sudarshan61

As we know HDFC/Axis and other banks do cancel the credit card for misuse using NPS.

But I want to know how much is too much investment into NPS using credit card (Please not I am talking about genuine investment and not money rotation ).

I personally have been doing close to 70K a year without any issue so far.

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panchabhut wrote:

SSY – Investment has to be made for a period of 15 years. Maturity is 21 years from the date of first investment. Partial withdrawal upto 50% of the available balance is allowed for higher education or marriage of the girl child after 18 years of age of the child.
It is not a general investment and it is only for parents intending to save for higher education, marriage and other benefits of their girl child.

For premature closure other than marriage & education, or without valid proof, reason they will only get postal savings interest na bro

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decideaim wrote:

For premature closure other than marriage & education, or without valid proof, reason they will only get postal savings interest na bro

That is an intended functionality of the scheme to ensure that the funds are actually utilised for the girl child and not diverted elsewhere.
Other than marriage of the girl child, premature closure is also permitted in case of life threatening disease of the girl child or death of the guardian.

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panchabhut wrote:

I opened NPS through ICICIDirect about 6 years back. After completing the process, they prepared a prefilled form which I was required to download, sign, attach a photo and physically post to their office. My KYC details available with them was already pre-printed in the form. Got my physical PRAN after a couple of weeks of sending this.
My guess is, NSDL still requires physical signature in the account opening form as most of us do not have a legally valid digital signature. However, many things now work with Adhaar e-sign, but they do not seem to have activated this feature for NPS.

seems sending the form is mandatory for me.
I’ll do it anyways to avoid delays.

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@raman12 @decideaim @Sudarshan61 Guys can you please help me for the amount that I can invest in NPS Tier 1 & 2 respectively…Newbie to this…Right now add about 50k in PPF & 42k in LIC. Any better investment options for NPS Tier 1&2?

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itsmehd5 wrote:

@raman12 @decideaim @Sudarshan61 Guys can you please help me for the amount that I can invest in NPS Tier 1 & 2 respectively…Newbie to this…Right now add about 50k in PPF & 42k in LIC. Any better investment options for NPS Tier 1&2?

Also someone please suggest the best PFM (Pension Fund Manager) that I can choose while opening the NPS account. @Sudarshan61 @raman12 @decideaim

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pankajsammal wrote:

I do transfer 25k at a time (based on spend based offers on card) to my nps tier 2 (later convert 50k to tier 1 for tax purposes) account totalling to roughly 1 lakh a year (spread accross 2-3 cards based on offers). Never had any issue from last 3 years.

How do you convert 50k later to Tier1 from initial Tier 2 investment? @pankajsammal

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itsmehd5 wrote:

Also someone please suggest the best PFM (Pension Fund Manager) that I can choose while opening the NPS account. @Sudarshan61 @raman12 @decideaim

Try not to invest in nps if you are young and don’t come under a tax bracket where nps is your last option to save the tax. Age of 60 is a long time to keep money locked, and you can get better returns from moderate risk mf etc in long term.

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itsmehd5 wrote:

How do you convert 50k later to Tier1 from initial Tier 2 investment? @pankajsammal

In the nps portal website there is an option to transfer funds form tier 2 to tier 1, but it generally takes around 15 days so do it well before end of financial year.

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pankajsammal wrote:

Try not to invest in nps if you are young and don’t come under a tax bracket where nps is your last option to save the tax. Age of 60 is a long time to keep money locked, and you can get better returns from moderate risk mf etc in long term.

I guess 35+ person can think of NPS as an investment & tax exemption option ? @pankajsammal

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22sumit wrote:

seems sending the form is mandatory for me.
I’ll do it anyways to avoid delays.

bhai, no need to post the form,
i had got the same frozen issue and i also thought i need to send, but on reading about it for a couple of hours (after close to 8 months of letting the account be frozen), i came to know that i just need to do ekyc on nsdl website (tbh, i had directly opened my nps account and not via and bank). i did that and it was kyc compliant. my account is 3 years old.
same issue was with my mom’s account when i had opened her account last year and since i knew that it’s just ekyc issue, i did that after 2 days and it was done.

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itsmehd5 wrote:

I guess 35+ person can think of NPS as an investment & tax exemption option ? @pankajsammal

Yeah, if you come under 30% tax bracket and you have exhausted all the other options for tax exemptions. Then you can put in 50k in it.
But even after 60 years of age you can only withdraw 60% of it and the remaining will never generate enough of returns to be a worthwhile pension if you just put in 50k a year.

For me I would still prefer to create my own retirement corpus using long term mutual fund/stock investments and treat nps just as a way to save tax and not as an investment… But everyone have their own preferences.

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pankajsammal wrote:

Yeah, if you come under 30% tax bracket and you have exhausted all the other options for tax exemptions. Then you can put in 50k in it.
But even after 60 years of age you can only withdraw 60% of it and the remaining will never generate enough of returns to be a worthwhile pension if you just put in 50k a year.

For me I would still prefer to create my own retirement corpus using long term mutual fund/stock investments and treat nps just as a way to save tax and not as an investment… But everyone have their own preferences.

Even I want to think of long term MF with less risk but don’t know where to start & then what’s the way forward for investing?

Any guidelines you can provide @pankajsammal

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srp321 wrote:

bhai, no need to post the form,
i had got the same frozen issue and i also thought i need to send, but on reading about it for a couple of hours (after close to 8 months of letting the account be frozen), i came to know that i just need to do ekyc on nsdl website (tbh, i had directly opened my nps account and not via and bank). i did that and it was kyc compliant. my account is 3 years old.
same issue was with my mom’s account when i had opened her account last year and since i knew that it’s just ekyc issue, i did that after 2 days and it was done.

I spoke to the cc executive at nsdl. They hv asked me to contact on Monday and they’ll let me know if any document is required. I’ve received the nps account activation and the charges being deducted from my sbi account yesterday. Hopefully if the same KYC works then I shouldn’t be sending any docs to them again. Anyways don’t they need the photograph and signature on the form? I’m concerned abt that part.

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22sumit wrote:

I spoke to the cc executive at nsdl. They hv asked me to contact on Monday and they’ll let me know if any document is required. I’ve received the nps account activation and the charges being deducted from my sbi account yesterday. Hopefully if the same KYC works then I shouldn’t be sending any docs to them again. Anyways don’t they need the photograph and signature on the form? I’m concerned abt that part.

haven’t u already uploaded the sign and photo?

from wht i remember, they asked for a bunch of documents including sign and photo which i had to upload (which i did)
i explicitly didn’t send any documents via post to them later
just ekyc and that too from their website after many months, and account was restored

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srp321 wrote:

haven’t u already uploaded the sign and photo?

from wht i remember, they asked for a bunch of documents including sign and photo which i had to upload (which i did)
i explicitly didn’t send any documents via post to them later
just ekyc and that too from their website after many months, and account was restored

I opened my nps account via sbi netbanking. It didnt ask me to upload photograph and sign at any step. I think same ekyc should suffice. Do you remember if you could make contributions detours the nps being frozen? I made my first payment of 1000 while opening the account.

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Sorry for the dumb question but how can I pay NPS using credit card? biggrin

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22sumit wrote:

I opened my nps account via sbi netbanking. It didnt ask me to upload photograph and sign at any step. I think same ekyc should suffice. Do you remember if you could make contributions detours the nps being frozen? I made my first payment of 1000 while opening the account.

adding contributions wont help, actually it wont allow to add amount until the time its unfrozen and for that u need to do ekyc

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raghupro wrote:

Sorry for the dumb question but how can I pay NPS using credit card? biggrin

its allowed but its selective, my one cc works but another doesnt, so try ur luck, hope u succeed.

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srp321 wrote:

its allowed but its selective, my one cc works but another doesnt, so try ur luck, hope u succeed.

Hearing this for 1st time…what error do U get ?which card don’t work ?
They allow CC as proper gateway/option so ideally all cards should work …

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i used icici apay card, tried it twice and it didnt go though, next time tried internet banking and viola, it worked!

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itsmehd5 wrote:

@raman12 @decideaim @Sudarshan61 Guys can you please help me for the amount that I can invest in NPS Tier 1 & 2 respectively…Newbie to this…Right now add about 50k in PPF & 42k in LIC. Any better investment options for NPS Tier 1&2?

Try to avoid LIC…I personally feel it is one of the biggest scam from investment point of view

If you have just started career, I will suggest you to consider ELSS and try to exhaust 80C limit. Consider NPS 1 if you are above tax threshold after doing 80C/ELSS/PF upto 50K
Ideally no limit on both NPS1 and 2. but do keep in mind investment into NPS1 gets locked till you are 60 years (plus you dont get full amount as lump sum). NPS2 is just like any other hybrid Mutual fund. Investment and withdrawal as per your own will(however bit of downside when it comes to taxation with regards to NPS2)

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I am beginner in NPS
From where to start?
Looking for medium risk and tax saving purpose
No CC btw

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srp321 wrote:

adding contributions wont help, actually it wont allow to add amount until the time its unfrozen and for that u need to do ekyc

details updated in nsdl website. Completed e-sign today by uploading photo and sign and aadhaar verification. Hopefully nothing is left from my side now.

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@BAT_MAN , @lootmaal , there are a couple of threads discussing pros-cons of nps in dd itself, have a look and u might have a better idea if u want it or not

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does flipkart axis cc provide 1.5% cashback for nps transactions?

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panchabhut wrote:

However, the claimed “aggressiveness” of ELSS can also be achieved through NS Active choice.

Nah. It can’t be. There is a huge difference in returns (5%+ yearly CAGR) even if we take the expense ratio into account.

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@pankajsammal @Sudarshan61 For tax purposes, do we have to put 50k in Tier1 & show it or we can put a combination of amount in Tier 1&2 ?
Is there any check from IT deptt. for an individual’s PRAN that 50k has to be there in Tier1 specifically?

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