NPS can fetch 80% higher yield

NPS account can fetch you upto 80% higher net yield than Mutual Funds and ULIP’s…. See How

If one invests Rs 6000 in NPS then the net yield after 30 years would be minimum 75% higher, as compared to mutual fund and insurance considering the fund performance is same and just because of much higher Fund management charges and allocation charges being charged by them. The 75% higher return is just because govt is also contributing Rs.1000/- per annum, just because, fund management charges being levied

Hence if you want to invest Rs.24000/- better open 4 accounts from your family and invest Rs.6000/- each where you get Rs.4000/- from the government.. Please refer the table

below where comparison is shown in the net yield @ various interest rate with or without govt contribution and be surprised by what difference Rs.1000/- government contribution will make to your portfolio.

Assumptions:

Fund management charges for mutual funds 2%

FMC and all other charges in NPS would never exceed 0.055%

ULIPS have lower FMC than mutual fund but loaded heavily with allocation charges in initial policy years

Fund performance of NPS, ULIP and Mutual funds are the same

Investment duration is 30 years

Investment of Rs.6000/- is done per annum, if investment amount per annum is higher then increase in Net yield% would fall

NPS		Mutual fund/ULIP’s
Investment amount (per annum)	6000	Investment amount (per annum)	6000
Returns @10%	1085661	Returns @10%(deducting 2% per annum FMC)	734075
Returns @10% with govt contribution	1266604	Returns @10% with govt contribution	NA
Increase in net yield(due to Rs 1000/- govt contribution)	180943	Shortfall compared to NPS(with govt contribution)	-532529
Increase in net yield%	17%	Loss in net yield% compared to NPS(with govt contribution)	-73%
Investment amount (per annum)	6000	Investment amount (per annum)	6000
Returns @12%	1621756	Returns @12%(deducting 2% per annum FMC)	1085661
Returns @12% with govt contribution	1892048	Returns @12% with govt contribution	NA
Increase in net yield(due to Rs 1000/- govt contribution)	270292	Shortfall compared to NPS(with govt contribution)	-806387
Increase in net yield%	17%	Loss in net yield% compared to NPS(with govt contribution)	-74%
Investment amount (per annum)	6000	Investment amount (per annum)	6000
Returns @14%	2440422	Returns @14%(deducting 2% per annum FMC)	1621756
Returns @14% with govt contribution	2847159	Returns @14% with govt contribution	NA
Increase in net yield(due to Rs 1000/- govt contribution)	406737	Shortfall compared to NPS(with govt contribution)	-1225403
Increase in net yield%	17%	Loss in net yield% compared to NPS(with govt contribution)	-76%

for more details about NPS (New Pension Scheme) please visit

http://www.assettreat.com/2010/02/all-about-nps-new-pension-scheme.html

Disclaimer: These are just the indicative figures, please do your own research before investing.

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