Retirement Planning Showdown: NPS vs EPF - Which Offers Better Returns in 2025?

As retirement planning gains importance in India, the debate between National Pension System (NPS) and Employees' Provident Fund (EPF) intensifies. NPS offers market-linked returns of 8.5-12%, with flexibility in investment choices and tax benefits up to Rs. 2 lakh. EPF provides guaranteed returns of 8-8.5%, with the current rate at 8.15%, offering stability and tax-free interest. While NPS allows equity exposure up to 75%, EPF invests 5-15% in equities. Experts suggest considering both schemes based on individual risk tolerance and financial goals. NPS suits those comfortable with market risks, while EPF is ideal for steady, guaranteed returns.

 

Sources: Kotak Securities, Moneycontrol, Taxmann