New pension system gets savings account
The Pension Fund Regulatory and Development Authority (PFRDA) has launched the Tier II investment account of the New Pension System (NPS) for government as well as non-government employees. Unlike the Tier I account in which investors’ funds are locked in till they are 60 years of age—the vesting stage—the Tier II account offers more flexibility. It puts no limits on the number of withdrawals, but has fixed a minimum balance limit of Rs2,000. This limit is waived off whenever the money is redirected to the Tier I account.
To open a Tier II, that works more as a savings account, it is mandatory to have a a Tier I account, a pension account. Just like in a Tier I account, there are six fund managers and three fund options—equity (you can invest up to 50% of your portfolio in equities), fixed income instruments other than government securities and government securities. You can also go for the auto choice option, which tailors your portfolio depending on your age.
To open the account, you need to pay an activation charge of Rs20, apart from other transaction charges. It can be opened with a minimum contribution of Rs1,000. Subsequent contributions need to be at least Rs250 each. Since this account allows untimely withdrawals, it does not qualify for any tax deduction.
Encash debt funds’ dividends now
On the back of the benchmark 10-year government security hitting a 2-month low (falling yields lead to a rise in prices as they share an inverse relationship) on account of ample liquidity and low fund inflows from abroad, medium and long-term bond and gilt funds are making gains and distributing dividends. ICICI Prudential and IDFC mutual funds are among these funds. Since the road ahead is expected to be tough given the impending interest rate hike, periodic encashment would be a good strategy.
Kayezad E. Adajania
Baroda Pioneer Children Fund closed
Baroda Pioneer wound up its children scheme, effective 23 November. Baroda Pioneer Children Fund invested in a mix of equity and debt scrips. It was among the few targeted schemes that were launched in the last decade. Targeted schemes cater specific goals such as children’s education and retirement.
Illustration: Jayachandran / Mint
Kayezad E. Adajania
Now get a cover for doctor’s consultation
Apollo DKV Health Insurance Co. Ltd, a standalone health insurance company, has launched a health plan called Maxima. Besides providing basic health insurance, the policy also covers policyholders for “outpatient consultation”. Maxima comes with a flat sum insured of Rs 3 lakh and offers an optional critical illness rider for the same amount. The policy also has a floater version to it, wherein more than one member of a family can be covered.
Depending on the coverage, the number of outpatient consultation would vary from four to eight consultations in a year. The fee for outpatient consultation is paid for by the company through coupons and is not part of your Rs 3 lakh cover. Maxima is the second health insurance policy that offers its policyholders a cover against outpatient consultation. The first to give this facility is ICICI Lombard General Insurance Co. Ltd’s Health Advantage Plus.