The Department of Expenditure, under the Ministry of Finance, has extended to CAB employees the additional investment options that were earlier made available only to Central government employees under a notification issued by the Department of Financial Services in November 2025.
What is the latest development?
Under a memorandum issued by the Department of Expenditure, eligible employees of Central Autonomous Bodies enrolled under NPS can now choose from two additional life cycle funds:
1. LC-75 High (earlier Aggressive Life Cycle Fund – LC-75)
This option allows equity exposure of up to 75%, making it suitable for subscribers seeking potentially higher long-term returns and who are comfortable with greater market risk.
2. Aggressive Life Cycle Fund (earlier Balanced Life Cycle Fund – BLC)
This option caps equity exposure at 50%. The equity allocation gradually reduces once the subscriber turns 45 years, offering a balance between growth and capital preservation as retirement approaches.
These options will be made available through the Central Recordkeeping Agency (CRA) system.
What does this mean for employees?
Until now, these additional investment choices were available only to Central government employees covered under NPS. Their extension means employees of Central Autonomous Bodies, including institutions, councils and statutory organisations funded by the Centre that are covered under NPS, will now have the same flexibility in choosing how their pension corpus is invested.
The move enables subscribers to select an investment strategy based on their age, financial goals and willingness to take market risk, instead of relying only on the earlier default options.
How do the two funds differ?
The LC-75 High fund maintains a higher allocation to equities, making it suitable for younger investors or those with a longer investment horizon who seek higher growth potential.
The Aggressive Life Cycle Fund, on the other hand, follows a more balanced approach. It limits equity exposure to 50% and progressively reduces it after the age of 45, lowering portfolio risk as retirement nears.
Why has the government made this change?
According to the government, the objective is to provide investment flexibility to NPS subscribers in Central Autonomous Bodies. By offering multiple life cycle fund options, employees can better align their pension investments with their individual retirement planning needs and risk preferences.
The government said the move also strengthens subscriber choice and enhances the overall attractiveness of the National Pension System for employees covered under NPS.
Administrative ministries and departments have been directed to inform the Central Autonomous Bodies under their control about the availability of the new investment choices. The options will be enabled through the Central Recordkeeping Agency platform.
First Published: Jul 8, 2026 10:10 AM IST
