Which additional government scheme is linked with EPF for retirement benefits?

• A. Gratuity Fund
• B. National Pension System (NPS)
• C. Employees State Insurance (ESI)
• D. Social Security Scheme

Answer: (B)

The National Pension System (NPS) is indeed linked with the Employees' Provident Fund (EPF) as a complementary retirement benefits scheme. While the EPF primarily functions as a savings and retirement scheme for employees in the organized sector, the NPS provides an additional layer of retirement savings for subscribers.

The NPS is managed by the Pension Fund Regulatory and Development Authority (PFRDA) and allows individuals to invest in a mixture of equity, government securities, and fixed deposits, depending on their risk appetite. This flexibility in investment options helps individuals build a larger retirement corpus beyond what is accumulated through EPF contributions.

When combined with EPF, the NPS offers a more diversified approach to retirement planning, giving employees a greater opportunity to enhance their financial security upon retirement. By providing an avenue for voluntary savings in addition to the mandatory EPF, the NPS encourages a culture of retirement planning, thus complementing the benefits offered by EPF.