The Public Provident Fund (PPF) is a government scheme offered by the Post Office, which offers an annual interest rate of 7.1%. The most important feature of this scheme is that your money is completely safe, and you also receive a tax exemption of up to ₹1.5 lakh.
If you invest ₹1.5 lakh in PPF every year for 25 years and grow it using a 15+5+5 year strategy, this amount can grow to ₹1.03 crore. This means that simple savings can gradually make you a millionaire, without any stock market risk.
When your fund reaches ₹1.03 crore, the annual interest earned on it is approximately ₹7.31 lakh. This means you will earn approximately ₹61,000 in interest every month. This means you will have a regular income even after retirement.
The biggest advantage of PPF is that both the interest earned and withdrawals are completely tax-free. Additionally, this is a government-guaranteed scheme, meaning your money is completely safe, no matter how volatile the market is.
You can open an account with just ₹500, and investing in the name of a minor is also possible. This makes it a great option not only for your retirement but also for your children’s future, and gradual savings can one day translate into substantial earnings.