What is Universal Pension Scheme? Check All Details Here

Over the past few years, governments around the world have been working to strengthen their social security systems to provide financial support to all citizens in their old age. The universal pension plan is such an effort to bring comprehensive and universal pension plans to all individuals independent of their employment status or background.

Background and purpose

The universal pension scheme will become a contributing and voluntary pension scheme. It should apply to all citizens over the age of 18, making it particularly useful for unorganized sectors, businessmen and self-employed individuals who are not usually able to obtain regular pension plans. The program is designed to consolidate all existing pension plans under an umbrella, making it easier to access and benefit participants.

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Key Features

• Voluntary contributions: People have the option to contribute to retirement savings, giving them flexibility in financial management.
• Available for all: The program is not limited to employees in the formal sector, but is available to all persons over the age of 18 (including those in informal or unorganized sectors).
• Unification of existing plans: Integration of programs such as the Pradhan Mantri-Shram Yogi Maandhan Program (PM-SYM) and the integration of national traders and self-employed national pension schemes (NPS-Traders) into a single system. This is expected to make the process easier and provide better benefits for subscribers.
• Target Group: The main targets are unorganized sector workers, businessmen and self-employed people who usually do not have access to regular pension plans.
• Pension Benefits: Eligible members can receive pension benefits at the age of 60, allowing them to earn normal income in their old age.

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Benefits and impacts

A universal pension plan has many benefits:

• Financial Security: It provides their seniors with a safety blanket, providing them with a regular source of income.
• Inclusion: All inclusive, filling the social security coverage of people outside the formal employment sector.
• Simplify management: The merger of current plans simplifies the administrative process, minimizes bureaucracy barriers, and promotes the convenience of individuals who can control their pension contributions.

Global Environment

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The same type of program is being carried out elsewhere. For example, Bangladesh has a universal pension scheme where citizens of 18 to 50 years can contribute until the age of 60, while those over the age of 50 contribute for 10 years. The program encompasses tax relief and allows subscribers to withdraw 50% of their deposits as loans.

The universal pension plan is the main measure to make the social security system more comprehensive and inclusive. Through a voluntary and affordable pension scheme, the government can ensure that everyone has the opportunity to secure their future financially. As the program continues to evolve, it is likely to make a significant contribution to improving the quality of life for millions of individuals during the retirement year.

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Source: https://dinhtienhoang.edu.vn
Category: Optical Illusion