Atal Pension Yojna (APY)

The Atal Pension Yojana (APY) is a government-backed pension scheme in India that is administered by the Pension Fund Regulatory and Development Authority (PFRDA). It is designed to provide a guaranteed pension to individuals in the unorganized sector, such as small farmers, self-employed workers, and others who do not have access to a formal pension scheme.

Under the APY, individuals can contribute a certain amount of money on a regular basis to receive a pension after the age of 60. The pension amount depends on the contribution made and the age at which the individual starts contributing. The APY offers a fixed pension of INR 1,000, INR 2,000, INR 3,000, INR 4,000, or INR 5,000 per month, depending on the contribution made.

To open an APY account, individuals must be aged 18 to 40 years and must have a savings bank account or a Jan Dhan Yojana (PMJDY) account. They must also choose a bank or a post office where they want to open their APY account and make their contributions.

The APY offers several benefits to subscribers, including a guaranteed pension after the age of 60, government contributions for eligible subscribers, tax benefits under Section 80CCD of the Income Tax Act, and flexibility in the choice of pension amount. It is a good option for individuals who want to save for their retirement and receive a regular income after they stop working.

You can apply through your mobile or net banking. If you neither have mobile banking or net banking then visit to branch and tell them to open / create your APY account.

Benefits of the APY scheme are:

Guaranteed pension: The APY scheme provides a guaranteed pension of Rs. 1000 to Rs. 5000 per month, depending on the contribution made by the individual.

Affordability: The APY scheme is designed to be affordable, with a low minimum contribution of Rs. 55 per month for those aged 18-40 years, and higher contributions for those aged 41-60 years.

Tax benefits: Contributions made to the APY scheme are eligible for tax deductions under section 80CCD (1B) of the Income Tax Act, up to a maximum of Rs. 50,000 per year.

Flexibility: The APY scheme allows individuals to choose their own pension amount, depending on their financial capabilities and needs.

Government support: The APY scheme is backed by the Government of India, which provides a partial subsidy to eligible subscribers to encourage more people to join the scheme.

Nomination facility: The APY scheme allows individuals to nominate a beneficiary who will receive the pension in case of the subscriber's death.

Overall, the APY scheme is a useful tool for individuals to plan for their retirement and ensure a steady stream of income during their golden years.

APY Calculation -

Let's say if you are 24 now and you intend to take 1000 plan for monthly.

According to APY plan the contribution is depend on your age. The earlier you start the less contribution you will have to make.

As we have taken 24, so we will have to pay 70 Rupee per month.

70*12 = 840

You contribute 840 Rupee every year until you are 40. The total investment will be 840*16 = 13,440 and government will contribute 50% if you are eligible.