Post Office Scheme: If you want to invest in a scheme with guaranteed interest, then you can invest in PPF. By investing just Rs 1,000 per month, you can add more than Rs 8 lakh to this scheme.
PPF: There is no dearth of options when it comes to investment these days. To strengthen their portfolio, investors prefer to invest in various schemes. If you want to invest in a scheme with guaranteed returns and want to accumulate good money, then you can choose the option of Public Provident Fund (PPF). PPF is a government guaranteed scheme. One has to invest in it for a long time.
The scheme matures in 15 years. If you want to take advantage of it further, you can extend your account for 5 years each. 500 rupees to 1.5 lakh rupees can be deposited annually in PPF. Currently, it is getting 7.1 percent interest. At the same time, interest can also be saved in three ways in this EEE category scheme. To invest in it, you can open an account in any post office or government bank. If you invest even just 1,000 rupees a month in this scheme, then you can add more than 8 lakh rupees in a few years. Know how-
Know how to add more than 8 lakh
If you invest Rs 1,000 every month in this scheme, you will invest Rs 12,000 in a year. The scheme will mature after 15 years, but you have to extend it twice in blocks of 5 years each and continue the investment for 25 years continuously. If you invest Rs 1,000 every month for 25 years, you will invest a total of Rs 3,00,000. But at the rate of 7.1 percent interest, you will get Rs 5,24,641 only from interest and your maturity amount will be Rs 8,24,641.
Tax savings will be done in three ways
PPF is a scheme of EEE category, so you will get tax exemption in three ways in this scheme. EEE means Exempt Exempt Exempt. In the scheme falling in this category, the amount deposited annually is not taxed, apart from this, the interest earned every year is not taxed and the entire amount received at the time of maturity is also tax free, that is, there is tax saving in investment, interest/return and maturity.
Know the rules of extension too
PPF account extension is done in blocks of 5-5 years. In case of PPF extension, the investor has two types of options – first, account extension with contribution and second, account extension without investment. You have to get extension with contribution. For this, you will have to give an application to the bank or post office, wherever you have an account. Keep in mind that you have to submit this application before the completion of 1 year from the date of maturity and you have to fill a form for extension. The form has to be submitted in the same post office/bank branch where the PPF account has been opened. If you are unable to submit this form on time, then you will not be able to contribute to the account.
