EPF vs PPF vs NPS — Which One Secures Your Retirement Best?

Author

Rajat Dhar
December 03, 2025

Table of Contents

💭 Introduction

Planning for retirement can be tricky when every scheme claims to be “the safest” or “the smartest.” Among India’s top three—EPF, PPF, and NPS—each serves a unique purpose. Let’s decode which one fits your financial life stage and how combining them can build a stress-free retirement.

1️⃣ Employee Provident Fund (EPF): The Automatic Saver

EPF is a mandatory savings plan for salaried employees. Both employer and employee contribute 12% of basic salary plus DA.

  • Interest rate: 8.25% (FY 2024–25)

  • Tax status: Fully exempt under the EEE rule (Exempt-Exempt-Exempt)

  • Liquidity: Partial withdrawal after 5 years for specific needs

💡 Finogent View: Ideal for disciplined accumulation—automatic, stable, and suited for long-term employees.

2️⃣ Public Provident Fund (PPF): The Safe Long-Term Compounding Tool

PPF suits conservative investors wanting guaranteed, tax-free returns.

  • Interest rate: 7.1% (fixed quarterly)

  • Lock-in: 15 years (extendable in 5-year blocks)

  • Tax benefit: Up to ₹1.5 lakh under Section 80C; interest and maturity fully tax-free

💡 Finogent Tip: Use PPF as your “stability anchor” alongside market-linked products.

3️⃣ National Pension System (NPS): The Growth Engine

NPS is a voluntary, market-linked plan regulated by PFRDA, allowing exposure to equity, corporate bonds, and government securities.

  • Returns: 9–11% long-term average (depending on allocation)

  • Tax benefit: ₹1.5 lakh under 80C + extra ₹50,000 under 80CCD(1B)

  • Withdrawal: 60% corpus tax-free at 60; 40% invested in annuity

💡 Finogent View: Suitable for investors comfortable with moderate risk and seeking higher growth potential.

4️⃣ Comparing the Trio — Snapshot View

Feature

EPF

PPF

NPS

Type

Mandatory (salaried)

Voluntary (anyone)

Voluntary (market-linked)

Interest/Return

8.25%

7.1%

9–11% (equity exposure)

Tax Benefit

80C (₹1.5L)

80C (₹1.5L)

80C + 80CCD(1B)

Liquidity

Partial after 5 yrs

Loan & partial after 7 yrs

Partial (25%) after 3 yrs

Lock-In

Till retirement

15 years

Till age 60

Risk

Low

Low

Moderate–High

Best For

Salaried, risk-averse

Self-employed, conservative

Growth-focused investors

5️⃣ How to Combine Them for Maximum Impact

  • Young professionals: Focus on EPF + NPS (for long-term compounding)

  • Self-employed: Build core with PPF + NPS

  • Late starters (40+): Max PPF for tax-free stability; use NPS for growth buffer

  • HNIs: Diversify beyond these schemes into hybrid or AIF structures for tax optimisation

💡 Finogent Insight

No single plan wins the retirement race. EPF gives stability, PPF gives safety, and NPS gives scalability. The best strategy is a blend aligned to your income type, retirement horizon, and tax slab.

CTA: Let Finogent help you create the right mix of EPF, PPF, and NPS — customised for your lifestyle and goals.

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