New Delhi,The lifestyle of all of us is changing very fast. In such a situation even after retirement, we need a significant amount every month. If you have started saving for retirement funds at the right age, then you can live the last phase of your life with joy. After the age of retirement, we have no regular source of income, hence the retirement fund is very important to meet the post-retirement needs. After retirement, the income is very limited. In such a situation, everyone needs a large retirement fund. According to experts, any person should start saving for retirement early in his job. This helps us to raise a large amount till the time of retirement. There are many schemes related to retirement funds. Schemes such as General Provident Fund (PPF) and Voluntary Provident Fund (VPF) are prominent.
Most of these schemes are long-term deposit plans and offer high returns. It is necessary for any customer to know all these while choosing one of these investment plans. This way the customer will find out which is the most accurate plan for him.
PPF : Public provident fund ie PPF is a very good investment option to create a retirement fund. PPF is a government-backed savings scheme. The most important thing about PPF is that it comes with EEE status. That is, there are three levels of interest subvention in this investment scheme. In this scheme, the maturity amount and interest income are also tax free. An investor can save income tax of Rs 1.5 lakh every year by investing in this scheme.
The scheme comes with a lock-in period of 15 years. It can also be extended further. Currently, the interest rate on PPF is 7.1 percent. Those who want to invest risk-free and do not want to choose a long-term investment option like NPS or VPF, can invest in PPF.
VPF VPF: VPF is an extension of EPF. This means that investors can go for VPF only when they have an EPF account. Like EPF, VPF offers 8.5 percent interest. If the employee deposits more than 12 percent of his basic salary and DA in the PF Fund, then it is called VPF or Voluntary Provident Fund. Any salaried employee can deposit his basic salary and DA up to 100 percent in VPF. Under this scheme, an investor can increase his contribution to EPF and get a much larger return in the long run.
Employee Provident Fund (EPF) : Every company with more than twenty employees has to contribute towards the PF of its employees. 12 percent of his basic salary and DA is deposited by the employee and the same by the company. EPF also has a pension fund. It is given to the employee after retirement. Currently, the interest rate on EPF is 8.5 percent. Employees can withdraw from their EPF account even before the maturity period under certain circumstances.
