High Return Pension Funds On Government-Securities (G-Sec) Scheme

The National Pension System (NPS) allows the subscribers to accept the asset allocation under G-Sec (government securities). The National Pension System (NPS), offered by the government of India permits the policyholders to select between active and auto choices. NPS G-sec funds have performed quite well in the past years, especially in the last year. The NPS G-sec pension funds have given double-digit returns over 3 years.

The active choice allows the subscriber to choose among equity, corporate debt, and G-Sec (government securities). While the auto choice allows the policyholder's allocation in the G-Sec asset class, which increases as one grows older. In the active choice, asset allocation will be decided depending on the age and the pre-decided grid under the NPS regulations. The pension fund manager will take care of this. On the other hand, in the auto choice, after the age of 55 years of the policyholder, the G-sec will range from 75-90%, which will certainly depend on the selected life-cycle fund. This ensures safeguarding the corpus over the long term against market volatility.

High return from NPS G-Sec Pension Fund

Till November 17, 2021, the 7 pension fund managers have given high returns of around 10.52%-11.71%, over 3 years. The LIC Pension Fund has given the highest return at 11.71%, the HDFC Pension Fund has given return at 11.21%, the Kotak Pension Fund has given return at 11.03%, the SBI Pension Fund has given return at 10.88%, the Birla Sun Life Pension Scheme has given returns at 10.86%, the ICICI Prudential Pension Fund has given return at 10.70%, while the UTI Retirement Solutions has given return at 10.52%. Although UTI stayed at the lowest position, even this return is also higher than the benchmark returns. Over 5 years of NPS G-Sec schemes, LIC topped among all 7 pension funds, and given return at 8.67%, followed by HDFC Pension Fund at 7.7%.

On the other hand, the benchmark CIL All Sovereign Bond TRI has given return at 10.51%, and debt: gilt has given return at 8.91%.