PPF, NPS, and EPF: Which Government Scheme Fits Which Goal
All three are government-backed, long-term, and tax-advantaged — but they're not interchangeable, and most people end up using more than one.
PPF, NPS, and EPF get grouped together as "government retirement schemes," which is accurate but not that useful — each has a different access rule, a different growth mechanism, and a different role to play, and most people end up relying on a mix rather than picking just one.
EPF — automatic, if you're salaried
If you're a salaried employee, EPF is largely automatic — both you and your employer contribute a percentage of your basic salary every month, with no active decision required beyond your employment itself. It's the base layer for most salaried Indians' retirement savings, not something you opt into separately.
PPF — voluntary, fully tax-free, longest lock-in
PPF is open to anyone, salaried or not, with a 15-year lock-in and a ₹1,50,000/year contribution cap. Its standout feature is EEE tax status — contribution, interest, and maturity are all completely tax-free, which is a real, guaranteed edge over most other fixed-income options once you account for tax.
NPS — market-linked, with a mandatory annuity
NPS lets you choose an equity/debt allocation, so its growth potential (and risk) is higher than PPF or EPF. The trade-off is that at least 40% of the final corpus must be converted into an annuity providing a monthly pension — you don't get to withdraw and invest that portion yourself.
Do this now
Most people benefit from layering these rather than choosing one — use the PPF Calculator, NPS Calculator, and PF Calculator with your own numbers to see how each contributes to your total retirement picture.