NPS, or the National Pension System, has slowly become a must-have in every retirement plan.
More and more people are voluntarily investing in NPS every year, and it’s easy to see why. With features like long lock-in period, low starting amount, and tax benefits, NPS makes saving for retirement easy and effective.
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But there’s one feature that truly adds power to this system, and one that many people still don’t know about: SIP in NPS.
Contrary to what many believe, yes, you can set up a Systematic Investment Plan (SIP) in your NPS account.
In this article, we’ll explain what SIP in NPS really means, why it’s a smart way to build your retirement corpus, and how you can set it up step by step.
What is SIP in NPS?
Just like in mutual funds, SIP in NPS allows you to invest a fixed amount of money automatically every month.
Instead of making large, last-minute contributions once or twice a year, SIP helps build a habit of regular investing, allowing your retirement corpus to grow steadily over time.
It offers the same benefits, discipline, rupee-cost averaging, and stress-free investing, but within the structure of the National Pension System.
If you want consistency without the headache of timing the market, SIP in NPS is the way to go.
Why should you set up SIP in NPS?
When it comes to building a corpus, it can’t be done without developing a consistent habit. A corpus in retirement will help you sustain your lifestyle without a regular income. This is why having a sufficient corpus will help you make the most of your retirement.
Regular contribution
Many people invest in NPS only once or twice a year, often near the tax-saving deadline. This irregular pattern doesn’t help in building a strong retirement fund. By setting up an SIP, you invest a fixed amount every month without fail. This habit ensures regular contributions and builds your retirement savings smoothly over time.
Benefit from rupee-cost averaging
Rupee-cost averaging means investing a fixed amount of money at regular intervals, no matter what the market is doing. Instead of trying to time your investments when prices are low (which is difficult even for experts), you invest steadily every month.
When the market is down, your fixed investment buys more units of the fund. When the market is up, it buys fewer units. Over time, this results in a lower average cost per unit, helping you avoid the risk of investing a large amount at the wrong time. SIP in NPS naturally follows this strategy, making your retirement investment both smart and stable.
Reduce decision stress
It can be tiring to keep deciding when to invest and how much. Many people delay or skip investing because of this. SIP removes that problem by automating the investment. Once it’s set up, the money is invested every month without you having to think about it. This builds a steady and stress-free investing habit.
Build a pension portfolio aligned with your long-term goals
NPS gives you exposure to equity, corporate bonds, and government securities. A monthly SIP keeps your portfolio diversified and aligned with your retirement timeline. Over the years, this structured approach compounds into a sizable, stable pension fund.
Example:
Let’s say you decide to invest ₹2,000 every month into your NPS account through SIP.
This amount gets automatically deducted from your bank account and credited to your NPS, just like an SIP in a mutual fund. Over one year, you would invest ₹24,000. Over 10 years, without even increasing the amount, that becomes ₹2.4 lakh,excluding market returns.
Now imagine if you increased it by just 10% every year. That small step would compound into a much larger retirement corpus over time,without any pressure to time the market or remember due dates.
That’s the power of SIP in NPS: small, regular steps that lead to big, long-term results.
You can calculate your NPS investment via SIP using our free NPS calculator : https://1finance.co.in/calculator/nps
How to start SIP in NPS
Setting up a Systematic Investment Plan (SIP) in the National Pension System (NPS) is one of the smartest ways to build your retirement corpus. With rising life expectancy and inflation, regular and disciplined contributions ensure that you build a sizable retirement fund without stressing about market timing or missing deadlines. Here’s how to set up SIP in NPS step by step:
Make sure you have the following:
- Active PRAN (Permanent Retirement Account Number)
- Mobile number linked with NPS
- Active email ID
- Net banking facility enabled for your bank account
- Bank account linked to your mobile for verification
Once these are in place, you’re ready to begin.
Step 1: Visit the Official NPS Website
Go to https://enps.nsdl.com, the official NSDL portal for NPS contributions.
Step 2: Log in Using Your PRAN
- Click on “Subscriber Login”
- Enter your PRAN, password, and date of birth
Step 3: Generate OTP for Verification
- Re-enter your PRAN and basic details
- Choose OTP delivery via SMS or Email
- Generate and enter the OTP to proceed to the payment page
Step 4: Verify Your Subscriber Details
On the payment page, check if your name and other details are correct. Confirm and proceed.
Step 5: Receive Your Virtual Account Details
Once verified, you will receive:
- Virtual NPS Account Number
- IFSC Code
These will be used to set up SIP through your bank’s net banking system.
How to Sett Up SIP in NPS via Net Banking
Step 1: Log in to Net Banking
Use your bank’s internet banking login credentials to access the portal.
Step 2: Add NPS Virtual Account as a Beneficiary
Use the following details:
- Account Number
- Beneficiary Name
- IFSC Code
- Account Type
Add the beneficiary and wait for activation (usually within a few hours).
Step 3: Start Contributing via NEFT/RTGS/IMPS
Once activated, you can transfer funds using:
The minimum amount you can invest in NPS is ₹500 per transaction. You can choose to invest more, but ₹500 is the lowest you need to get started.
Step 4: Enable Standing Instructions (Optional but Ideal)
To automate monthly contributions, set up Standing Instructions (SI) in your bank. This ensures you never miss a month, helping you stay consistent with your retirement planning.
SIP vs one-time contribution in NPS: Which one should you choose?
| Feature | SIP in NPS | One-Time Contribution |
| Frequency | Monthly / Auto | As per user’s choice |
| Convenience | Set once, runs automatically | Needs manual action every time |
| Market Timing Risk | Lower (cost averaging) | Higher (lump-sum risk) |
| Ideal For | Long-term investing | Last-minute tax saving |
SIP in NPS is ideal for salaried individuals, freelancers, or business owners aiming to build retirement wealth gradually.
To sum up:
Retirement planning isn’t just about saving, it’s about building a habit. And SIP in NPS gives you exactly that: a simple, flexible, and powerful way to grow your retirement corpus, one month at a time. By setting up a SIP, you automate your investments, benefit from market volatility through rupee-cost averaging, and eliminate the burden of decision-making. You don’t need to guess the right time or remember deadlines. You just set it once, and let it work in the background. Start small, stay regular, and let your pension portfolio grow with time. The earlier you begin, the stronger your retirement foundation will be.
