In a public provident fund, every month the interest is calculated based on the balance of the 5th. In this case, invest till 5th date.
If you are looking for a safe and better return option for you, then post office provident fund scheme is a great option. There are three levels of tax benefits. The benefit of deduction on investment, interest tax free and lump sum amount on maturity are also tax free. Right now the interest rate is 7.1% per annum but it is ineffective from tax benefit and inflation. In this case, the net return is much more than this.
If you invest 4500 rupees every month in the Post Office Public Provident Fund, or 150 rupees on a daily basis, then according to the current interest rate on maturity, you will get 14 lakh 84 thousand rupees. Talking about calculus, this scheme matures in 15 years. After investing 4500 every month, you will accumulate 821250 rupees in 15 years. According to the interest rate of 7.1 percent per annum, 6.63 lakh rupees will come in the form of interest. In this way, a total of 14.84 lakh rupees will be found.
Deposit up to 1.5 lakhs
Up to 1.5 lakh rupees can be invested in this scheme in a financial year. One gets the benefit of deduction under Section 80C by investing. This will give you relief in saving tax. Interest income is completely tax free and maturity too. In this way, there is relief on three frontiers of tax. On the basis of inflation, retail inflation is currently more than 5.5 per cent. In this case, it is the best option in terms of net return.
Remember the deadline of the 5th
In a public provident fund, every month the interest is calculated based on the balance of the 5th. In such a situation, invest till the 5th. If there is a lapse of even one day, then you will not get the benefit of interest for the whole 25 days. If this mistake is made every month, then interest will not be available for 300 days in 365 days. This saving instrument matures in 15 years. Up to a maximum of 1.5 lakh rupees can be deposited in a financial year. Minimum 500 rupees will have to be deposited.
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