The Central Government has introduced the Unified Pension Scheme (UPS) designed to provide a regular income for retired government servants. This new plan integrates the strengths of previous pension plans to make it a more reliable and positive experience.
What is Unified Pension Scheme?
Think of the UPS as a steady payroll that will ensure a fixed income when you get to retirement age. If you have been serving as a government employee for at least 25 years, the pension amount will be half of the average of their basic pay for the last 12 months of service. For instance, if you were previously earning Rs 50,000 per month, the pension you will receive will be ₹25,000 per month throughout your life. Everybody who works for 10 years gets a guaranteed pension that will help many people after they retire.
What is Atal Pension Yojana?
The Atal Pension Yojana (APY) targets workers engaged in the unorganised sector to receive a minimum assured pension upon attaining the age of sixty years. With APY, people can get a pension of Rs 1000 to Rs 5000 every month based on their regular contribution. To successfully become a member of the scheme one has to be aged between 18-40 years of age and one should possess a savings account. It is optional but useful to link Aadhaar and a mobile number to deal with the account with more convenience.
How is UPS Different from APY?
1. Target Audience: UPS is aimed at employees of the Central Government who served for an extended period, while APY is developed to cater to the employees of unorganized sectors.
2. Pension Amount: UPS provides a pension on the basis of the last pay drawn while APY assures Rs 1,000 to Rs 5,000 per month, and the government bears the burden of the difference.
3. Government Contribution: UPS receives 18.5% contribution from the government, compared to APY’s co-contribution of up to Rs 1,000.
Conclusion
The Unified Pension Scheme is a considerate effort put forward by the government to ensure its employees a secure future. In this regard, UPS guarantees that there is regular income after one has retired from working for his or her government.
In this article, we bring you the differences between Unified Pension Scheme (UPS) and Atal Pension Yojana (APY). Biz News Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
