Under UPS, eligible employees would be entitled to a pension that would give them more predictability than the usual NPS, which depends on investment returns and accumulation of corpus. It is thus designed to provide long-term financial security, linking benefits to basic salary and dearness relief, rather than being totally market-linked.
Eligibility, Latest Extension
Employees joining the Central Government between 1st April 2025 and 31st August 2025 and are under the NPS, are now allowed to opt for UPS. The latest extension given by the Government can be important; it permits the one-time exercise of option to join UPS up to 30th September 2025. This results in accommodating these employees, whose service commenced in that April-to-August window, a little more time to make their choice.
Pursuing a UPS was earlier to be opted for before 30th June 2025, but this has been extended to September so that more employees get time to analyze and reach an informed decision.
Key Rewards Of Going For UPS
Here are some of the main features attracting people to UPS:
- Assured Pension: Employees opting for UPS may get a pension amounting to about 50% of average basic pay drawn in the last 12 months before retirement, provided they have put in 25 years at least.
- Pro-Rata Pension: For those having less than 25 years of service but meeting the minimum qualifying service for pension (say 10 years), the pension could be proportioned accordingly.
- Lower Pension Bound: Just those having shorter qualifying could get a minimum pension of ₹10,000 per month.
- Family Pension: On the death of a retiree, a family pension of about 60% of assured pension is payable.
What Choosing UPS Means & Important Points
Opting into UPS is deemed a one-time, irrevocable choice.
- Only those under NPS can choose UPS; those outside of NPS are not eligible.
- Employees not opting for UPS by the deadline (currently 30 September 2025 for some service dates) shall be governed by the NPS.
Why The Extension Matters
Extension of the deadline of 30 June 2025 to 30 September 2025 allows more room for employees to understand UPS vs NPS, consider some financial aspects, and consult, if need be. This would go a long way for persons who would have commenced service from April to August 2025.
Also Read: Post Office Savings Scheme 2025: An Option of Safe Wealth Worth ₹40 Lakh