Public Provident Fund: Public Provident Fund (PPF) is a popular investment option for financial planning of people through long term investment.
Public Provident Fund: Public Provident Fund (PPF) is a popular investment option for financial planners through long term investment. The interest rate in the quarter is fixed by the government every quarter. Investors get returns on fixed interest. For this reason, investing in PPF is not only safe, but it also gives full benefit of tax exemption. PPF is a government-backed scheme, so it guarantees security for your money.
PPF is one of the most suitable investment options for self-employed professionals and employees not covered by EPFO. Apart from this, people who do not have any organized structure of job or business can choose PPF for long term investment. PPF provides a lump sum or monthly investment facility throughout the year. In this, a maximum of 1.5 lakhs or a monthly maximum of Rs 12500 can be deposited.
PPF Vs SSY: Where to deposit money for children?
1 crore will be fund on 37.5 lakh deposits
Now how much time for 1 crore fund
Maximum Monthly Deposit: Rs 12,500
Maximum annual deposit: Rs 1,50,000
Rate of Interest: Compounding 7.1% per annum
Maturity amount after 25 years: 1.03 crores
Total investment: 37,50,000
Interest benefit: Rs 65,58,015
Formula for PPF calculation
F = P [({(1 + i) ^ n} -1) / i]
I – Interest Rate
F – PPF maturity
N – Total Tenure
P – Annual Installment
How much will be made on maturity
Maximum Monthly Deposit: Rs 12,500
Maximum annual deposit: Rs 1,50,000
Rate of Interest: Compounding 7.1% per annum
Amount at maturity after 15 years: Rs 40,68,209
Total Investment: 22,50,000
Interest benefit: Rs 18,18,209
Post Office Net Banking: PPF, RD, TD, NSC; Many work will be done at home
Better interest rate
The central government revises the interest rate on PPF account every quarter. The interest rate on PPF is still more than 7 percent, 7.1 percent per annum. This is about 100 basis points more than FD. The scheme has a period of 15 years for subscribers after which the amount that comes under tax exemption can be withdrawn. But subscribers can apply to extend it for 5–5 years.
Tax benefits and loan facilities
Under Section 80C of the IT Act in public provident fund, tax rebate is available for investments up to Rs 1.5 lakh. Both the interest and maturity amount received in PPF are tax-deductible. At the same time, subscribers can also take loans on PPF account.
PPF: What to do on the maturity of the account, these three options will be available
Source: www.financialexpress.com
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