PPF is one of the safest options for long term savings. It is not only better in terms of safety, but it is also a scheme that gives higher returns than small savings schemes like FD, RD.
Public Provident Fund:
Public Provident Fund (PPF) is one of the safest options for long term savings. It is not only better in terms of safety, but it is also a scheme that gives higher returns than small savings schemes like FD, RD. The interest on PPF is currently available at 7.1 percent compounding per annum. If your goal is to create a fund for the future, then you can opt for this option. PPF account can also make you a millionaire. Know that if there is a plan to raise a fund of Rs 1 crore through PPF, then how much amount you will have to invest.
2 big benefits of PPF
The best thing about PPF is that due to the post office scheme, every single deposit of yours is also safe here. Here you have a government guarantee on every penny. The second big advantage is that it offers tax benefits on investment. No tax is to be paid on the interest amount and maturity amount.
How interest is added on PPF
Interest is added on the amount deposited in your PPF account from the 5th to the last of the month. So keep in mind the 5th of the month and make your monthly contribution before that. After this, if money comes in the account, then interest will be added on the same amount, which is in the account before the 5th.
Calculator: How to make 1 crore fund
The maturity of PPF is of 15 years and the maximum amount that can be deposited in the account every month is Rs 12500 i.e. Rs 1.5 lakh annually. Here you have to make a maximum contribution of Rs 12500 before 5th of every month till maturity. The total value on maturity will be Rs 40,68,209 at 7.1 per cent per annum interest. There is also an option to extend the PPF account by 5-5 years after maturity. In such a situation, if the contribution continues for 25 years, the total value of your investment with compounding interest will be Rs 1.03 crore.
Calculator: To Maturity
Maximum Monthly Deposit: Rs 12,500
Interest Rate: 7.1% p.a.
Amount on maturity after 15 years: Rs 40,68,209
Total Investment: 22,50,000
Interest Benefit: Rs 18,18,209
Calculator: For Funds of 1 Crore
Maximum Monthly Deposit: Rs 12,500
Interest Rate: 7.1% p.a.
Amount on maturity after 25 years: Rs 1.03 crore
Total Investment: 37,50,000
