NPS Vatsalya Rules Made Flexible

The NPS Vatsalya scheme is a pension account for children under 18, managed by their parents or guardians.

Recently, the rules for this scheme have been made more flexible.

Now, the minimum contribution to open and maintain the account is only ₹250.

At the age of 18, the child has three options: move the entire amount to a regular NPS account, take out 80% as a lump sum and use the rest to buy an annuity, or withdraw the full amount if it's less than ₹8 lakh.

Partial withdrawals are allowed after three years for specific reasons like education or medical treatment, but only up to 25% of the contributions.

If no action is taken by the age of 21, the account automatically shifts to a higher-risk investment option under the regular NPS rules.

This makes it easier for families to use this scheme for long-term savings while still having access to funds for important needs.