Active Choice vs Auto Choice in NPS: Which Investment Option Should You Choose?

 

Imagine you’re ordering coffee.

You could walk up to the counter and say, “I’ll decide exactly how much sugar, milk and coffee I want.”

Or you could simply pick your favourite preset and let the barista handle the proportions.

Investing for retirement can work in a somewhat similar way.

When you invest through the National Pension System (NPS), you get two broad investment approaches to choose from: Active Choice and Auto Choice. The choice of investment approach is one of the key features of NPS.

But which one is right for you?

The answer depends less on what is “better” and more on how involved you want to be with your investment allocation.

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