PPF account: Opened a Public Provident Fund account but is a bit careless in depositing money every month. You will lose it. There is a special reason behind this.
PPF account: Opened a Public Provident Fund account but is a bit careless in depositing money every month. You will lose it. There is a special reason behind this. It would be better to deposit money in the PPF account on a fixed date every month. If you cannot deposit money every month by visiting the bank, post office yourself, then you can take the help of online option. This will also save your time and there will be no hassle of commuting.
It is important to remember the 5th of the month
If you deposit the amount in PPF every month through installation and want to get the full benefit of it, then it is important to remember the 5th of the month. That is because the interest on PPF is calculated on the 5th of every month as the base. Interest on PPF account is calculated on the minimum balance till the 5th day of the month. Therefore, if you want to take full advantage of the deposit in PPF, then deposit money in it before the 5th of every month. If this happens, a new installment will be added to the account on deposit.
Understand with example – how is the calculation
Suppose you have opened a PPF account in April with an amount of Rs 500 and you are depositing Rs 500 in it every month through monthly installments. Now suppose you do not deposit the installment before the 5th of May, then at the end of May your total amount will be Rs 500 and interest will also be available on this only.
The total amount will be counted in the next month by including the amount deposited after the 5th. At the same time, if you put the installment after 5th in June, your total amount for that month will be only 1000 rupees and interest will be given on it.
Now suppose if you deposit the installment before the 5th of every month, then in the month of May your total amount will be 1000 rupees and interest will be received on this basis. Similarly, if the installment is deposited before the 5th of every next month, the total amount will increase by Rs 500. That is, you will always get the full benefit.
Deposit money with ECS
This is an option to deposit money online in the form of Electronic Clearing System (ECS). In this, a fixed amount can be transferred from one bank to another account every month i.e. regularly. For this you have to apply for ECS in the bank. Once the ECS is activated, the money will automatically be transferred from your bank account to the PPF account within the stipulated time.
You can also deposit with NEFT
National Electronic Funds Transfer (NEFT) is an online option to deposit money online. It can be used through net banking facility. To deposit money in PPF through this medium, you need to have your PPF account number and IFSC code of the bank branch in which your PPF account is held. With NEFT you can transfer money in no time.
