In the National Pension System (NPS), there are two main investment options: Active Choice and Auto Choice. 

1. Active Choice:
- Flexibility: You can decide how your funds are allocated across different asset classes
- Equity Cap: Maximum 75% in Equities till age 50, gradually reducing to 50% by age 60

  • Allocation Limits till Age 50:
    - Equity: 75%
    - Debt: 100%
    - Alternate Investments: 5%

Equity Allocation Matrix for Active Choice

Age (years)

Max. Equity Allocation

Upto 50

75%

51

72.50%

52

70%

53

67.50%

54

65%

55

62.50%

56

60%

57

57.50%

58

55%

59

52.50%

60 & above

50%


2. Auto Choice:
- Lifecycle Fund Allocation: Based on the selected fund type (Aggressive, Moderate, Conservative).

- No Asset Class A: Auto choice does not include asset class A.


3. Lifecycle Fund Types:
1. Aggressive Life Cycle Fund:
   - Equity, Government Bonds, Corporate Bonds: 75:10:15 (up to age 35), gradually reducing.
2. Moderate Life Cycle Fund:
   - Equity, Government Bonds, Corporate Bonds: 50:20:30 (up to age 35), gradually reducing.
3. Conservative Life Cycle Fund:
   - Equity, Government Bonds, Corporate Bonds: 25:30:45 (up to age 35), gradually reducing.


Asset Allocation Over Time:

Age

Aggressive Fund

Moderate Fund

Conservative Fund

Asset class in (%)

E : G : C

E : G : C

E : G : C

Up to 35 years

75 : 10 : 15

50 : 20 : 30

25 : 30 : 45

40 years

55 : 30 : 15

40 : 35 : 25

20 : 35 : 45

45 years

35 : 45 : 20

30 : 50 : 20

15 : 25 : 60

50 years

20 : 60 : 20

20 : 65 : 15

10 : 15 : 75

55 years

15 : 75 : 10

10 : 80 : 10

5 : 5 : 90


Refer to the Investment Options under NPSGuidelines for more details.