Presented By UTI Infrastructure Technology And Services Limited (a Government of India Company) ISO 9001: 2000 / 27001:2005 / 20000:2005 Certified Plot.

Presented ByUTI Infrastructure Technology And Services Limited

(a Government of India Company)ISO 9001: 2000 / 27001:2005 / 20000:2005 Certified

Plot No. 3, Sector 11, CBD Belapur Navi Mumbai – 400614

UTI Infrastructure Technology UTI Infrastructure Technology And Services LimitedAnd Services Limited

Year 2012 Year 2042

Pension is a form of Social Security/ Insurance in the form of Monthly payments paid to the citizens on attaining the age of superannuation / retirement to take care of day to day living expenses.

WHAT IS PENSION ?

WHY PENSION ?

Fall of Joint Family System Increase in Life Expectancy Improvement in Standard of Living,

Hygiene and Medical Facilities Increase in Diseases Increase in Cost of Living Expenses Changing Life Styles Sustainable Income for 2 to 2 ½

decades

Expectancy of Life After Retirement

Life expectancy has increased from 60 years to 80 years at present

Live joyfully today as if your going to die today evening

Plan for your future as if you are going to live for at least 100 years from now.

Advantages of Early Financial / Retirement Planning Larger time horizon. Develop Savings habit You budget your current expenditures Try to enhance your income Levels Time & energy for Extra Working Exploring new opportunities for investments You have the risk taking capacity IDEAL AGE FOR START OF RETIREMENT

PLANNING IS 25-28 YEARS

The early you Start Investing, the Better it is! X starts Investing at the age of 28 yrs He Invests `1000 every month till the

age of 58 yrs Total Investment: `3.60 Lacs

Y starts Investing at the age of 38 yrs He Invests `1500 every month till the

age of 58 yrs Total Investment: `3.60 Lacs

20.7910.86

Early Investment, Always Pays

@10% assumed rate of growth

X Y

Assuming a growth of 10% CAGR in both the cases, X’s investment would appreciate to `20.79 Lacs and Y’s Investment would appreciate to `10.86. That means X’s investment would appreciate to almost double that of Y’s

Life Stages

Projection of Earnings & Expenses

AGE

EA

RN

ING

&

EX

PE

NS

ES

Just Employed

Marriage and house

hold expenses

Children and

educationPlanning for Retirement

1-20 20-25 25-34 34-55 55-60 60 & Above

Education

Retired Life

INCOME REQUIREMENTS ON RETIREMENT

Current Per Person Per Meal requires : ` 50.00

3 Meals a Day requires : ` 50.00 x 3 =

`150.00

For 2 Persons requirement is : `300.00 Per day

Current Income Requirement for Per annum (for Food) `109,500.00

Additional Household Requirements / Annum (Rentals,

Electricity, Telephone / Mobile, Gas / Fuel, conveyance)

etc.

: `60000.00

Medical Expenses for a Retired Couple / Annum : `25000.00

Miscellaneous Expenses / Annum : `5000.00

Total : `2,00,000.00

Requirements for 2 Member family : `2.00 Lakhs P.A.

Requirement Per Annum at the end of 20 Years

(10% inflation)

: `13.45 Lakhs P.A.

Requirement for 25 Years : `3.36 Crores

NEW PENSION SYSTEM A VIDEO FILM

Voluntary It is prudentially regulated by Government, Simple and Easy to understand Low Cost Allotment of Unique PRAN Number Ensures Complete Portability Flexibility Transparency Simple and Web enabled/Online

WHY NATIONAL PENSION SYSTEM(NPS)?

NPS – An Open ended Investment Scheme with following features:

Two types of accounts are available under the scheme:

Tier I Account - A Non-Withdrawable account (Creating a retirement Corpus)

Tier II Account - A voluntary savings Account - Providing liquidity to park your short term spare funds.

Investment Choice

Active Choice – Individual choice (Asset Class E, C & G).

Auto Choice – Lifecycle Fund.

Equity (not more than 50% of total

Investment) Corporate Bonds (No Limit) Government Bonds (No Limit)

ACTIVE CHOICE

TABLE FOR AUTOCHOICE (LIFECYCLE FUND)

Age Asset Class E Asset Class C Asset Class G

Up to 35 yrs 50% 30% 20%

36 yrs 48% 29% 23%

37 yrs 46% 28% 26%

38 yrs 44% 27% 29%

39 yrs 42% 26% 32%

40 yrs 40% 25% 35%

41 yrs 38% 24% 38%

42 yrs 36% 23% 41%

43 yrs 34% 22% 44%

And so on……

Key Benefit of NPS For Middle And Lower Middle Class

(Can be done by people in the Unorganized Sector)

NPS offers you a grant of `1,000/- per annum for investors investing less than `12000/- per annum (for the subscribers who do not come under the fold of any of the Provident Fund Schemes of India), subject to Net minimum contribution of `6000/- in the current Financial Year.

Provide Services for Application Collection from Subscribers, KYC Documentation and Registration Formalities

Contribution Collection and Uploading Withdrawals Other Subscriber Services Issue of PAN Card (Charges applicable) Grievance Resolution

ROLE OF POINT OF PRESENCE(POP – UTIITSL)

Change of ParticularsChange of NomineeChange of Composition of Asset ClassChange of Auto-Active Choice OptionChange of Pension Fund ManagersWithdrawalsStatement of Transactions

OTHER SERVICES

• Recordkeeping and Administration• Issue of PRAN Number• Maintenance of Databases• Coordination between various

Intermediaries

Role of Central Record keeping Agency (CRA)

Government Sector: (All Three) (This model can be opted only by Corporates and not by Individual Subscribers)

LIC Pension Fund LimitedSBI Pension Funds LimitedUTI Retirement Solutions Limited

Any one Pension Funds Managers under the Unorganized Sector are :

ICICI Prudential Pension Funds Management Company LimitedIDFC Pension Fund Management Company LimitedKotak Mahindra Pension Fund LimitedReliance Capital Pension Fund LimitedSBI Pension Funds LimitedUTI Retirement Solutions Limited

PENSION FUNDS MANAGERS

ANNUITY SERVICE PROVIDERS

On attaining Normal Retirement Age (NRA) of 60 years – compulsory annuitizing of at least 40% of your pension wealth and the remaining 60% can be withdrawn as a lump sum or in a phased manner.

Minimum 10% of the pension wealth should be withdrawn every year. Any amount lying to the credit at the age 70 should be compulsorily withdrawn in

lumpsum.

Life Insurance Corporation of India SBI Life Insurance Co. Ltd. ICICI Prudential Life Insurance Co. Ltd. Bajaj Allianz Life Insurance Co. Ltd. Star Union Dai-Ichi Life Insurance Co. Ltd. Reliance Life Insurance Co. Ltd. HDFC Standard Life Insurance Co. Ltd.

ANNUITY SERVICE PROVIDERS

Annuity Service Providers (ASPs) appointed by PFRDA shall provide Pension in the form of Annuities to the individual subscribers from the age of 60 years till death.

On death, the balance corpus will go to the Nominee.

Pension benefits shall be given by the Annuity Service Providers

(a) Pension (Annuity) payable for life at a uniform rate to the annuitant only.

(b) Pension (Annuity) payable for 5,10,15 or 20 years certain and thereafter as long as you are alive. In this type of Annuity, every higher option of number of years of Pension chosen, will give you lesser amount of proportionate Pension.

(c) Pension (Annuity) for life with return of purchase price on death of the annuitant (Policyholder).

(d) Pension (Annuity) payable for life increasing at a simple rate of 3% p.a.

(e) Pension (Annuity) for life with a provision of 50% of the annuity payable to spouse during his/her lifetime on death of the annuitant. (Ardhangi)

(f) Pension (Annuity) for life with a provision of 100% of the annuity payable to spouse during his/her life time on death of the annuitant. ((In this option (f) The amount of pension available to the Subscriber during lifetime will be less than that available under option e)).

06 Types of Annunities under NPS

NPS Trust (overall Controlling Body) NPS Trustee Bank (Intermediary for

Fund collection from POPs and depositing in the PFMs and withdrawals)

Custodian

OTHER INTERMEDIARIES

BENEFITS TO SUBSCRIBER

Cheapest investment product with better growth options through long term market-linked saving

Choice of various funds

Individual Retirement Account is portable

Platform to monitor and manage investment to meet subscriber's diverse financial goals

Employees contribution is eligible for tax exemption as per the Income Tax Act, 1961 as amended from time to time (Only in Tier I Account)

Offers Tier II account which is a voluntary savings facility with anytime liquidity/withdrawal option

Grievance management through CRA Website, Call Center, Email or Postal Mail

Routine/quarterly disclosure of the funds

Auto Choice option

Release of daily NAV by PFMs

An option to remain invested even after your retirement.

SERVICES TO SUBSCRIBERS

A citizen of India, whether resident or non-resident can join NPS subject to the following conditions :

Subscriber should be between 18-60 years of age as on the date of submission of his / her application.

Subscriber should comply with the prescribed Know Your Customer (KYC) norms as detailed in the Subscriber Registration Form (CS-1 and CS-2).

ELIGIBILITY NORMS

OPERATIONAL FEATURES OF NPSParticulars Tier I Tier II

Option of Selection of Account Mandatory Optional

Initial contribution at the time of account opening

Rs.500 Rs.1000

Minimum amount per contribution Rs.500 Rs.250Minimum account balance at the end of Financial Year

As applicable

Rs.2000

Minimum amount of contribution per annum

Rs.6000 1000

Minimum Number of Contributions/Annum

One One

Frequency on Number of Installments and Cap on the Amount to be Invested

Unlimited Installments and No cap on amount

Scheme Operational Charges A low cost option for planning retirement and giving maximum

returns to subscribers.

Intermediary

Charge Head Service Charges

Method of Deduction

CRA

PRAN Opening Charges Rs. 50

Through cancellation of

units

Annual PRAN Maintenance Cost per account

Rs.225

Charge per transaction Rs. 6

POP

Initial subscriber registration and contribution upload

Rs.100

To be collected upfront

Any subsequent transaction2

0.25% of the Contribution Amount subject to a Minimum of Rs.20/- per contribution

Intermediary Charge Head Service Charges

Method of Deduction

Trustee Bank

Per transaction emanating from a RBI location

Zero

Through NAV deductionPer transaction

emanating from a Non-RBI location4

Rs.15

Custodian Asset servicing charges

0.0075% p.a. for electronic segment & 0.05% p.a. for physical segment

Through NAV deduction

PFM charges Investment Management fee3

0.25% p.a. wef 01/11/2012

Through NAV deduction

Contd…

Why NPS Through UTI ITSL

UTI ITSL is a Government of India Co. UTI ITSL has 69 Branches across the

Country UTI ITSL has more than 300 AMFI

qualified Staff giving Personalized Service across the country

All information about the NAV, MF Schemes can be easily available.

PAN Card Service can be made available(Charges applicable)

High quality of Service Orientation

NPS can be run simultaneously with Superannuation, PF, Gratuity etc.

Corporate acts only as a Support System for extending the Retirement benefit to its employees, without any short/long term liability

NPS – How is it Beneficial for Corporate

CORPORATE CAN CHOOSE Extend this Benefit to a Select Group

of Employees within the Company Fix the Contribution amount as a

Percentage of Basic Pay Fix the Frequency of Contributions Choose the Government Model or the

All Citizen’s Model

NPS – How is it Beneficial for Corporate

Platform to co-contribute for employees’ pension

Corporate may select choice of PFM for its employees or leave the option to employees for selecting PFMs for themselves.

Can claim tax benefits for the amount contributed towards pension of employees from 1st Apr, 2012 upto 10% of the salary (basic and dearness Allowance)Tax Deductible allowance of employers Contribution

BENEFITS TO CORPORATES

  EXAMPLE 1   EXAMPLE 2   EXAMPLE 3

 Without NPS Contribution

With NPS Contribution

 Without NPS Contribution

With NPS Contribution

 Without NPS Contribution

With NPS Contribution

  Annual Salary   Annual Salary   Annual Salary

  10% Tax Bracket   20% Tax Bracket   30% Tax Bracket

Basic Pay 350000 350000   600000 600000   1000000 1000000

HRA(50%) 175000 175000   300000 300000   500000 500000

Professional Allowance 80000 45000   140000 80000   250000 150000

Contribution to PF (12%) 42000 42000   72000 72000   120000 120000

Contribution to Gratuity(4.81%) 16835 16835   28860 28860   48100 48100

Contribution to NPS 0 35000   0 60000   0 100000

Gross Salary 663835 663835   1140860 1140860   1918100 1918100

Deductions                

Section 80 C (includes Employee Contribution to 100000 100000   100000 100000   100000 100000

Mediclaim 15000 15000   15000 15000   15000 15000

Section 80CCD(2) 0 35000   0 60000   0 100000

Total 115000 115000   115000 115000   115000 115000

Total Income 605000 570000   1040000 980000   1750000 1650000

Taxable Income 490000 455000   925000 865000   1635000 1535000

Tax Liability 29000 25500   115000 103000   320500 290500

Tax Savings   3500     12000     30000

Pension Fund

Presented ByUTI Infrastructure Technology And Services Ltd.

(a Government of India Company)ISO 9001 : 2000 / 27001:2005 / 20000:2005 Certified

Plot No. 3, Sector 11, CBD Belapur New Mumbai - 400614