Employee Provident Fund Benefits: EPF is deducted every month from the salary of employed people, but most of the people do not know these 10 big benefits of it. Know
EPF Scheme: If you work, then Provident Fund (PF) amount must be deducted from your salary every month. Most people think of it as just saving for retirement. This is the reason why many employees never try to know that PF is not just a saving scheme, but a package of many such facilities which are useful to you during and after the job. Know which 10 big benefits you get from PF account.
1. A big fund is prepared for retirement
The biggest advantage of PF is that small savings happen automatically every month. The contributions of both the employee and the employer are accumulated and interest is also earned on it every year. If you work for a long time, this amount can become a big financial support at the time of retirement.
2. Pension benefits are also available
Many employees are not aware that a part of the employer’s contribution also goes towards the Employee Pension Scheme (EPS). You can get the benefit of monthly pension after retirement if the prescribed conditions are fulfilled.
3. Insurance protection for the family
If an employee dies while in service, the eligible family can get financial assistance under the Employee Deposit Linked Insurance Scheme (EDLI). For this, the employee does not need to pay separate insurance premium.
4. Facility of PF advance if needed
It is not necessary to withdraw complete PF every time. Under certain circumstances, employees can also take advance from their PF account. Like buying or building a house, treatment of serious illness, children’s education, marriage or some other prescribed needs.
5. Also helps in saving tax
The amount deposited in PF and certain tax benefits available on it, as per applicable income tax rules, can help in tax planning. However, its benefits will depend on your income and applicable tax regime.
6. Money moves with you when you change jobs.
PF account is not closed on getting a new job. You can transfer your PF to the new institution, thereby maintaining a continuous record of both your savings and service period.
7. Adding a nominee brings ease to the family.
It is very important to add a nominee in the PF account. This makes the process of settlement of claims easier for the family in case of any untoward incident and they face less trouble in getting the necessary benefits.
8. Interest is available on deposited amount
Money is not only deposited in the PF account, but EPFO also adds interest on it as per the interest rate declared for every financial year. This compounding helps your savings grow faster in the long run.
9. Most facilities are available online
Today checking PF balance, downloading passbook, updating KYC, adding nominee and many other services are available online. Due to this, employees do not have to visit offices.
10. Can become the biggest support in difficult times
If you lose your job, suddenly a big need arises or the time of retirement comes, the amount deposited in PF can act as a financial security cover. This is the reason why experts recommend keeping PF deposited for a long time instead of withdrawing it unnecessarily.
It is not right to consider PF as just a mandatory amount to be deducted from salary. It integrates many features like savings, pension, insurance, tax planning and financial help in times of need. Therefore, every employee must keep checking the status of his PF account, KYC, nominee and contribution from time to time, so that he can get full benefit of all his rights and facilities when needed.