Public Provident Fund Latest Interest Rate: Public Provident Fund (PPF) for investment is one of the few popular options in which you get good returns as well as saving tax. Despite being so popular, many times people are not able to take full advantage of it.
New Delhi: Public Provident Fund Latest Interest Rate: Public Provident Fund (PPF) for investment is one of the few popular options, in which you not only get good returns as well as save tax. Despite being so popular, many times people are not able to take full advantage of it. For example, if you get to know how interest is calculated on PPF and how you can get maximum interest, then your amount can increase manifold.
PPF interest rates have come down in the last year alone
The government had drastically cut the interest rates of small savings schemes on 30 March 2020, almost a year before today. Interest rates on PPF are also at 7.1%. Let us tell you that the interest on small savings schemes and PPF is reviewed every quarter. These interest rates have a big impact on the rate of inflation.
How interest is calculated on PPF
Interest is calculated every month on PPF, but it is credited to the account at the end of the financial year. That is, whatever interest you earn every month is put in your PPF account on 31 March. However, there is no fixed date when to deposit money in PPF account. You can deposit money in PPF monthly, quarterly, half-yearly and annually.
How to get more interest on PPF
Let us now explain how interest is calculated. Interest on PPF is calculated on the amount in the account from the 1st to the 5th of every month. That is, if you put money in PPF account till the 5th of a month, then that money will get interest in the same month, but if you deposited the money after the 5th, that is, on the 6th, then the interest on the deposited amount will be the next month. will get.
Let’s understand this PPF calculation with an easy example. By which you will get to know how you can get more interest by investing money at the right time.
Example number-1
assume that you deposited Rs 50,000 in your account on April 5, till March 31, there is already 10 lakh rupees in your account. From April 5 to April 30, the total amount in your PPF account was Rs 10,50,000, which is the minimum balance. So, the monthly interest on this was 7.1 percent – (7.1% / 12 X 1050000) = Rs 6212.
Example No. 2
Now suppose you did not deposit the amount of 50000 rupees till 5 April and after that on 6 April. From April 5 to April 30, the minimum balance in your account will be 10 lakh rupees. How much was the monthly interest on this
(7.1% / 12 x 10,00,000) = Rs. 5917
If you deposit with this trick, you will get more interest
Think the amount of investment is 50,000, but the way of depositing made a difference in interest. In such a situation, if you want maximum interest on your money in PPF, then keep this trick in mind and deposit the money by the 5th of the month so that you get the interest of that month. Experts also recommend that PPF get tax rebate on investments of 1.5 lakh, so if you want to take this tax exemption, then deposit the entire amount of 1.5 lakh between 1st April to 5th April as soon as the new financial year starts. Give it. If you are not able to do this, then deposit the money by the 5th of every month.
