PFRDA Launches New Retirement Scheme For Retirees Under NPS

Current Context: On May 15, 2026, the Pension Fund Regulatory and Development Authority (PFRDA) introduced Retirement Income Schemes (RIS) and flexible Drawdown options under the National Pension System (NPS).

• This reform enhances retirement planning by allowing phased withdrawals from the lump-sum corpus while keeping funds invested for growth, without altering the mandatory annuity requirement.

Highlights

• RIS Steady Fund: Lifecycle-based glide path; equity reduces from 35% at age 60 → 10% at age 75, held constant till 85.
• Phased Withdrawals: Retirees can draw down 60–80% corpus systematically instead of one-time lump sum exit.
• Withdrawal Methods: Two styles — Systematic Payout Rate (SPR) (percentage-based, default) and Systematic Unit Redemption (SUR) (equal units redeemed).
• Flexible Payouts: Choice of monthly, quarterly, or annual withdrawals, available up to age 85.

Mandatory Annuity: 20–40% of corpus must still be used to purchase annuity for lifelong pension.
Risk Note: Drawdown payouts are market-linked, not guaranteed, requiring prudent risk management.

Question:

Q.1 Under the RIS Steady Fund of the National Pension System (NPS), equity allocation reduces from 35% at age 60 to what percentage at age 75?
a) 5%
b) 10%
c) 15%
d) 20%

Answer: b) The lifecycle-based glide path under RIS Steady Fund lowers equity exposure to reduce risk with increasing age.