If you want to raise a large fund by investing monthly, the Public Provident Fund (PPF) scheme would be perfect for this. Under this scheme, interest is currently being paid at 7.1 per cent per annum, which is much higher than bank fixed deposits. Under this scheme, by investing only 1 thousand rupees a month, you can create a fund of about 3.21 lakh rupees in 15 years. We are telling you with this scheme how you can easily generate large funds through this scheme.
You will get Rs 6.43 lakh for investing 2 thousand months
Under this scheme, by investing only 2 thousand rupees a month, you can create a fund of about 6.43 lakh rupees in 15 years. On the other hand, if you invest 500 rupees a month, then after 15 years you will get around 1.6 lakh rupees. Know here how much you will gain by investing in it.
| Investment (in Rs. Every month) | How much will you get after 15 years (Rs) | How much will you get after 20 years (Rs) |
| 500 | 1.6 Lakh | 2.65 Lakh |
| 1 thousand | 3.21 Lakh | 5.30 Lakh |
| 2 thousand | 6.43 Lakh | 10.60 Lakh |
| 3 thousand | 9.64 Lakh | 15.91 Lakh |
Note: This table is given according to a rough estimate as the interest on PF is reviewed every 3 months. Apart from this, interest has been calculated annually in the table given here.
Can open account in post office or bank
A PPF account can be opened in a post office or bank by someone else in his own name and on behalf of a minor. However, as per the rules, a PPF account cannot be opened in the name of a Hindu Undivided Family (HUF).
Can open account for 500 rupees
The minimum amount required to open a PPF account is Rs 500. A minimum of Rs 500 is required to be deposited in a financial year, while the maximum investment limit has been fixed at Rs 1.5 lakh per year.
Extension will be given for 5-5 years after maturity
The PPF account matures in 15 years, although the period can be extended to 5-5 years within one year of maturity. For this, one year has to be increased before the maturity is completed.
5 year lock in period
Money cannot be withdrawn from this account for 5 years after the year of opening the PPF account. After completion of this period, money can be withdrawn by filling Form 2. However, after withdrawing money 15 years ago, there will be a deduction of 1% from your fund.
It gives cheaper loan
You can also take a loan against a deposit on a PPF account. You are entitled to take a loan from PPF from one financial year after the end of that financial year to the end of the fifth financial year in which you have opened a PPF account. If you have opened a PPF account in January 2017, then you can take a loan from 1 April 2018 to 31 March 2022. You can take a maximum loan of 25% on the deposit.
You get the benefit of tax exemption on this
PPF falls under the category of EEE. That is, you get the benefit of tax rebate on the entire investment made in the scheme. Also, there is no tax to be paid on the entire amount of interest and investment from the investment in this scheme. The rate of interest on PPF investment varies every three months.
PPF account cannot be seized
PPF account cannot be seized at the time of debt or other liability by any court or order.
Who can open PPF account?
Any person can open this account in his name in a post office or bank. Apart from this, an account can be opened by anyone else on behalf of the minor.
