On October 24, 2025, the Government of India (GoI) approved the extension of Life Cycle 75 (LC75) and Balanced Life Cycle (BLC) investment options to central government employees under National Pension System (NPS) and the Unified Pension Scheme (UPS). It was announced by the Ministry of Finance(MoF).
- The move aims to enable flexibility for employees to plan their retirement and manage their savings according to individual preferences.
Exam Hints:
- What? Approved to extent Investment options to central government employees
- Who? Government of India (GoI)
- Investment options: LC75 & BLC
- Schemes: NPS, UPS
- LC75: Max 75% in equities, tapering from age 35–55.
- BLC: Modified LC-50; equity tapering from 45 years
- Options: Default, Scheme G (100% govt securities), LC-25 (25% equities), LC-50 (50% equities).
About Expanded Investment Options under NPS & UPS:
Investment Options: Under NPS & UPS, central government employees can now select from several investment options, including:
- Default Option: Standard pattern defined by the Pension Fund Regulatory and Development Authority (PFRDA).
- Scheme G: 100% investment in government securities with low risk and fixed returns.
- LC-25: Up to 25% in equities, tapering gradually from age 33–35.
- LC-50: Up to 50% in equities, tapering from age 35–55.
- LC-75: Up to 75% in equities, tapering from age 35–55.
- BLC: Modified LC-50, with equity exposure tapering from age 45, allowing longer equity participation.
Impact of Expansion:
Flexibility: The expansion provides greater flexibility, enabling the central government employees to choose options that match their retirement goals and risk tolerance.
Equity Exposure: The glide path mechanism gradually reduces equity exposure to 15% for LC75 and 35% for BLC by 55 years of age, helping protect their savings from large market fluctuations.
Diversified Choices: The broadened Auto Choice options give employees more diversified choices for retirement planning.
Individual Preferences: The investment options enable employees to structure their retirement savings.
About National Pension System (NPS) :
Scheme: It is a retirement saving scheme, launched in 2004, backed by GoI, that helps individuals build a pension corpus, offering flexible investment options such as equities, government securities, and bonds, along with tax benefits.
Benefits: Upon retirement, a part of the corpus can be withdrawn as a lump sum, and the rest provides a regular pension through an annuity.
About Unified Pension Scheme (UPS):
Scheme: The UPS, approved by the union cabinet on 24 August 2024, was notified on 24 January 2025 as an option under the NPS for eligible central government employees and became operational from 1 April 2025.
- It is a retirement savings scheme backed by GoI, designed for Central government employees who joined service on or after January 1, 2004.
Benefits:It allows regular contributions from employees and government, offers flexible investment options similar to NPS, and provides a lump sum plus regular pension at retirement.
About Ministry of Finance (MoF):
Union Minister – Nirmala Sithraman (Rajya Sabha- Karnataka)
Minister of State (MoS) – Pankaj Chaudhary (Constituency – Maharajganj, Uttar Pradesh, UP)
