How to Choose the Best NPS Fund Manager
Compare NPS pension fund managers based on returns, fund size, and consistency. Learn how to select and switch fund managers for optimal retirement corpus.
NPS offers you choice—seven pension fund managers compete for your money. But which one should you pick? And does it really matter?
Let's analyze the data and help you choose wisely.
The Seven NPS Fund Managers
| Fund Manager | Abbreviation | Type |
|---|---|---|
| SBI Pension Fund | SBI PF | Public sector |
| LIC Pension Fund | LIC PF | Public sector |
| UTI Retirement Solutions | UTI RS | Public sector |
| HDFC Pension Fund | HDFC PF | Private sector |
| ICICI Prudential Pension Fund | ICICI Pru PF | Private sector |
| Kotak Pension Fund | Kotak PF | Private sector |
| Axis Pension Fund | Axis PF | Private sector |
All manage assets across four classes: Equity (E), Corporate Bonds (C), Government Securities (G), and Alternative Assets (A).
Calculate your NPS corpus: Use our NPS Calculator to project your retirement savings.
Performance Comparison: Equity (E) Class
The equity class is where fund managers have the most room to differentiate.
5-Year Returns (Annualized)
| Fund Manager | 5-Year Return | Rank |
|---|---|---|
| HDFC Pension Fund | 15.8% | 1 |
| ICICI Pru Pension Fund | 15.2% | 2 |
| Kotak Pension Fund | 14.9% | 3 |
| SBI Pension Fund | 14.5% | 4 |
| UTI Retirement Solutions | 14.2% | 5 |
| Axis Pension Fund | 13.8% | 6 |
| LIC Pension Fund | 13.5% | 7 |
10-Year Returns (Annualized)
| Fund Manager | 10-Year Return | Rank |
|---|---|---|
| SBI Pension Fund | 12.8% | 1 |
| HDFC Pension Fund | 12.5% | 2 |
| UTI Retirement Solutions | 12.3% | 3 |
| ICICI Pru Pension Fund | 12.1% | 4 |
| Kotak Pension Fund | 11.9% | 5 |
| LIC Pension Fund | 11.6% | 6 |
| Axis Pension Fund | 11.4% | 7 |
Observation: Rankings shift over time. Recent top performers may not be long-term leaders.
Performance Comparison: Corporate Bonds (C) Class
| Fund Manager | 5-Year Return | 10-Year Return |
|---|---|---|
| SBI Pension Fund | 9.2% | 9.5% |
| HDFC Pension Fund | 9.1% | 9.3% |
| ICICI Pru Pension Fund | 9.0% | 9.2% |
| Kotak Pension Fund | 8.9% | 9.1% |
| UTI Retirement Solutions | 8.8% | 9.0% |
| Axis Pension Fund | 8.7% | 8.9% |
| LIC Pension Fund | 8.6% | 8.8% |
Observation: Much tighter range (0.6% spread). Fund manager choice matters less for debt.
Performance Comparison: Government Securities (G) Class
| Fund Manager | 5-Year Return | 10-Year Return |
|---|---|---|
| SBI Pension Fund | 8.8% | 9.2% |
| LIC Pension Fund | 8.7% | 9.1% |
| UTI Retirement Solutions | 8.6% | 9.0% |
| HDFC Pension Fund | 8.5% | 8.9% |
| ICICI Pru Pension Fund | 8.4% | 8.8% |
| Kotak Pension Fund | 8.3% | 8.7% |
| Axis Pension Fund | 8.2% | 8.6% |
Observation: G-Sec returns are nearly identical. Public sector funds have a slight edge.
Does Fund Manager Choice Really Matter?
The Honest Answer: It Matters Most for Equity
| Asset Class | Return Spread | Impact on ₹50L Corpus |
|---|---|---|
| Equity (E) | 2-3% | ₹10-15 L difference |
| Corporate Bonds (C) | 0.5-0.7% | ₹2-3 L difference |
| Government Securities (G) | 0.4-0.6% | ₹1-2 L difference |
For a 25-year NPS journey, choosing the right equity fund manager can mean ₹10-15 lakh more at retirement.
But Consistency Matters More
| Fund Manager | Rank in Year 1 | Rank in Year 3 | Rank in Year 5 |
|---|---|---|---|
| HDFC PF | 2 | 1 | 1 |
| SBI PF | 1 | 3 | 4 |
| ICICI Pru PF | 4 | 2 | 2 |
| Kotak PF | 3 | 4 | 3 |
Rankings fluctuate. Chasing last year's top performer often backfires.
How to Choose Your Fund Manager
Criteria 1: Long-Term Track Record
Look at 7-10 year returns, not just recent performance.
| Good Sign | Red Flag |
|---|---|
| Consistently in top 3 | Volatile rankings |
| Steady returns | Huge swings |
| Large AUM | Declining AUM |
Criteria 2: Fund Size (AUM)
Larger AUM generally indicates trust and stability.
| Fund Manager | Equity AUM | Total AUM |
|---|---|---|
| SBI Pension Fund | ₹1.2 L Cr+ | ₹3.5 L Cr |
| LIC Pension Fund | ₹80,000 Cr | ₹2.8 L Cr |
| UTI Retirement Solutions | ₹35,000 Cr | ₹90,000 Cr |
| HDFC Pension Fund | ₹25,000 Cr | ₹65,000 Cr |
| ICICI Pru Pension Fund | ₹20,000 Cr | ₹55,000 Cr |
| Kotak Pension Fund | ₹15,000 Cr | ₹40,000 Cr |
| Axis Pension Fund | ₹8,000 Cr | ₹20,000 Cr |
Criteria 3: Investment Style
| Fund Manager | Style | Best For |
|---|---|---|
| SBI PF | Conservative, index-hugging | Risk-averse investors |
| HDFC PF | Growth-oriented | Higher return seekers |
| ICICI Pru PF | Balanced | Middle-ground investors |
| Kotak PF | Quality-focused | Stability seekers |
| LIC PF | Conservative | Government employee default |
Criteria 4: Expense Ratio
NPS has very low expenses, but there are small differences:
| Fund Manager | Expense Ratio |
|---|---|
| SBI PF | 0.01% |
| LIC PF | 0.01% |
| UTI RS | 0.01% |
| HDFC PF | 0.02% |
| ICICI Pru PF | 0.02% |
| Kotak PF | 0.03% |
| Axis PF | 0.03% |
Difference is negligible—don't let 0.01% difference drive your decision.
My Recommendation by Investor Type
For Conservative Investors
Best choice: SBI Pension Fund or LIC Pension Fund
| Why | Reason |
|---|---|
| Largest AUM | Most trusted |
| Consistent returns | Not volatile |
| Government-backed | Added comfort |
For Growth-Oriented Investors
Best choice: HDFC Pension Fund or ICICI Pru Pension Fund
| Why | Reason |
|---|---|
| Strong equity returns | Outperforms in bull markets |
| Professional management | Private sector expertise |
| Good track record | Proven over 10+ years |
For Balanced Approach
Best choice: UTI Retirement Solutions or Kotak Pension Fund
| Why | Reason |
|---|---|
| Middle-ground returns | Neither best nor worst |
| Stable management | Experienced teams |
| Good across asset classes | Balanced competence |
Can You Switch Fund Managers?
Yes! NPS allows you to switch once per financial year.
How to Switch
- Log in to CRA website (cra-nsdl.com or cra-kfintech.com)
- Go to "Transaction" → "Change Fund Manager/Scheme Preference"
- Select new fund manager
- Submit request
When to Consider Switching
| Scenario | Action |
|---|---|
| Consistently bottom performer (3+ years) | Consider switch |
| One bad year | Wait and watch |
| Major management change | Evaluate new team |
| Your risk appetite changed | Adjust allocation, maybe manager |
When NOT to Switch
| Scenario | Why Not |
|---|---|
| Last year's #1 is different | Don't chase recent performance |
| Small return difference (< 1%) | Transaction cost and effort not worth it |
| You just opened account | Give it 2-3 years |
Active vs Auto Choice: A Related Decision
When selecting fund manager, also decide on:
| Choice | What It Means | Best For |
|---|---|---|
| Active Choice | You pick allocation (E, C, G, A) | Involved investors |
| Auto Choice | Lifecycle auto-rebalancing | Hands-off investors |
Auto Choice Options
| Lifecycle Fund | Starting Equity | At Age 55 |
|---|---|---|
| LC75 (Aggressive) | 75% | 15% |
| LC50 (Moderate) | 50% | 10% |
| LC25 (Conservative) | 25% | 5% |
Recommendation: If you understand markets, choose Active with max equity (75% until 50). Otherwise, Auto LC75.
Fund Manager + Allocation: The Winning Combo
| Age | Fund Manager | Allocation | Rationale |
|---|---|---|---|
| 25-35 | HDFC/ICICI Pru | 75% E, 15% C, 10% G | Growth phase, need alpha |
| 35-45 | SBI/HDFC | 65% E, 20% C, 15% G | Still growth, some stability |
| 45-55 | SBI/UTI | 50% E, 30% C, 20% G | Capital preservation starts |
| 55-60 | SBI/LIC | 30% E, 40% C, 30% G | Safety first |
The Bottom Line
| Decision | My Recommendation |
|---|---|
| If you're young (< 40) | HDFC or ICICI Pru (higher equity returns) |
| If you're older (> 50) | SBI or LIC (stability, large AUM) |
| If you're unsure | SBI (largest, consistent, trustworthy) |
| If you want simplicity | Any + Auto Choice LC75 |
Fund manager matters most for equity allocation. Choose one with:
- Strong long-term track record (10+ years)
- Large AUM (trust indicator)
- Consistency (not just recent outperformance)
Don't overthink it—even the "worst" NPS fund manager beats most traditional pension products.
Calculate your NPS retirement corpus: Use our NPS Calculator to project your pension based on your contributions.