What is the difference between a pension fund and a provident fund

What is the difference between a pension fund and a provident fund Introduction: The Importance of Retirement Planning Hello everyone! Welcome to today's video, where we delve into the world of retirement planning. One of the fundamental aspects of this process is understanding the different types of funds available, such as pension funds and provident funds. While they may seem similar at first glance, there are crucial distinctions that can significantly impact your financial future. So, let's get started! Defining Pension Funds: A Closer Look Pension funds are essentially long-term investment vehicles designed to provide individuals with a steady income during their retirement years. These funds are typically established by employers, who contribute a portion of the employees' salaries to the fund. Over time, these contributions, along with any returns generated from investments, grow to form a substantial corpus. Upon retirement, the individual receives regular payments, ensuring a consistent income stream. Understanding Provident Funds: A Comprehensive Overview Similar to pension funds, provident funds are also aimed at securing an individual's financial well-being post-retirement. However, there are a few key differences.