ppf scheme
The way in which after President Donald Trump came to power, the decisions taken by him affected the global economy. In fact, people’s investments were damaged to a great extent; due to the market collapse, even common investors lost their money. In such a situation, if you want to keep your money safe in this period, then PPF option is better for investment. In this scheme, you can raise a fund of Rs 41 lakh by investing only Rs 12,500 every month and Rs 1.50 lakh annually.
Public Provident Fund (PPF) is one of the most trusted long-term savings schemes in India. Especially working people like it more, because it keeps their future and retirement secure. Even though the interest rate has remained almost the same for many years, PPF still attracts people because it is completely safe, there is no tax on returns and it has the benefit of compounding. It is not affected by market fluctuations.
At the current 7.1% interest rate, if you deposit Rs 1.5 lakh every year, your fund grows to Rs 40.68 lakh in 15 years. Out of this, more than Rs 18 lakh will be in the form of interest only, which is completely tax-free.
Guaranteed earnings from compound interest
PPF is a long-term savings account run by the Government of India. In this, the interest received every year is added to the amount of the next year, which is called compound interest. It is getting 7.1% interest from April 2020. Its security and complete tax exemption (EEE benefit) make it an excellent option for those looking for a safe investment.
How to open PPF account?
Opening a PPF account is very easy. You can open it in any bank or post office. Any Indian citizen can open a PPF account in his own name or in the name of his minor child. The basis for opening an account is Voter ID or Driving License (proof of identity), PAN card, address, nominee form and passport size photograph. As per PPF rules, you can deposit a minimum of Rs 500 and a maximum of Rs 1.5 lakh in a year. You can deposit this amount in one go or several times. If the interest rate remains 7.1% and you deposit Rs 1.5 lakh every year, then after 15 years you will get interest of more than Rs 18 lakh.
Complete account of PPF investment
If a person deposits Rs 1.5 lakh in PPF account every year, then he will get interest at the fixed annual rate of 7.1 percent. The total deposit amount in 15 years will be Rs 22,50,000. Which will become Rs 40,68,209 after including interest.