Nowadays, when the interest rate has reduced considerably, the importance of ppf has increased even more. Because the interest earned from it is still high. Now if you go to get FD in state bank, then you will get maximum rate of 5.4% but PPF is still getting the rate of 7.1%.
This is not the only benefit in PPF, apart from this, tax is also avoided in many ways. Apart from this, you can also withdraw money when needed, and the most important thing is that you have peace of mind. In this post, we will tell you about the benefits of PPF.
1. Excellent interest rate . Higher Interest Income
Interest rates have come down a lot. It is very difficult for those who want a safe income. He does not feel like keeping money in the bank. Now you see that the maximum rate of 5.4% is being available on getting FD in the State Bank. In ICICI bank also, a rate of more than 5.5% cannot be found. Similar is the rate of all banks a little more or less.
Where will the man deposit the money? Obviously you will get some relief from PPF. It is not that the rate has not decreased here. Its rates have also come down. and may decrease further. But we can have this much confidence that its rate will be more than the FD of the bank. This is usually what happens.
I have analyzed the rates of the last twenty thirty years. This proves that the rate of PPF is always better than bank FD. So friends, if you are depositing money in the bank, then deposit money here instead of it, it will be beneficial in any case. Those who want to invest in traditional insurance scheme will also get more benefit in PPF.
2. Money safe. Safe Deposit
Friends, it is not just about high interest rate. You are going to get a lot of relief from PPF. Because when you invest money here, there is no worry about whether the money will get lost. Because nowadays you know that the condition of banks is thin.
In such a situation, PPF will give you peace of mind. And the reason for this is the government’s guarantee. Whatever money we deposit in PPF, it is the responsibility of the government to return it.
This is because this is a small saving scheme of the government . Its money goes directly to the account of the government. And the government only gives interest on this money. You will say that money is deposited in the bank or post office. Then how did the government come in the middle?
Friends, it is true that investment in this scheme is done only through bank or post office but their role is only of intermediary. The bank or post office takes money and deposits it with the government itself.
But can the government also default? So friends it is not impossible. But the probability of that is very less. Because through tax, money keeps coming in the hands of the government continuously. And that is why the chances of the governments sinking are considered very less. Just believe that out of all the types of investments, the government small saving scheme is the safest.
3. No one misleads. No Misselling
There is no scope for drowning or getting trapped in PPF because there is no fraud in this scheme. You must be aware that nowadays bank employees, agents and marketing people are desperate to get your money invested here and there.
The greed of high return is shown, emotional talks are done. Millions of people have lost their money by falling into the smooth talk of friends agents. But this will not happen in PPF. You will never get trapped by investing here.
This is because it has no agent. Nobody tries to sell it. Even the employees of the bank may not even discuss this scheme. They will try to mislead for some other scheme.
Just friends, keep one thing in mind that if a person is pushing a scheme, then it means that he is getting benefit in it. And this benefit will be at your cost.
These people will not talk about PPF because it is only for your benefit. They do not get any commission. They do not have any advantage, so they will also do evil to it.
4. Tax Saving | Many Tax Benefits
Often you must have seen that in the season of tax saving, insurance agents start hovering around you. They know that as soon as January comes, there will be tension in your mind to save tax. And in the same tension, you will be easily caught in any scheme.
Often there is an attempt to give such a scheme so that the agent gets maximum commission. Now if there will be more commission of the agent, then obviously it will be given from your money only.
Friends, I would say that to save tax, do not fall in the trap of insurance scheme. Insurance is meant to cover risk and for that you only think about term insurance . For tax saving, PPF is very good. If you do a job, then tax saving through EPF will also be good.
If you invest in PPF then you will get tax benefit in three ways.
- The first benefit will be when you deposit money in this account. Because in lieu of the money you deposit in this account, you get a tax deduction. This deduction is available under section 80C.
- Apart from ppf, there are many other investments in section 80C, from which tax deduction is available. In this, the amount of money you deposit in listed investments gets deducted from your taxable income. And because of this your tax liability also decreases. Under this section, you can claim a total tax deduction of up to 1.5 lakhs. In ppf also you can deposit only one and a half lakh rupees in a year.
- Apart from this, there is no tax on the interest you get in ppf account. On the other hand, if you deposited money in the fixed deposit of the bank, then its interest would also be added to your taxable income and you would have to pay tax. But the interest of PPF is tax-free and it is not added to your taxable income.
- The third tax benefit from PPF is when you withdraw money from it. Because no matter how big the maturity amount is, no tax is levied on it. In this way, PPF gives you tax benefits in three ways.
5. Long term savings Long Term Saving
People investing in PPF deposit more money for their future. Because this scheme inspires you for long term saving.
The rule of the scheme is that you have to deposit money for at least 15 years. And every year at least 500 rupees have to be deposited. If you don’t, penalty will be imposed. Due to this rule, people deposit money regularly in this account and in this way good savings are made.
6. Cheap Debt | Cheaper Loan Available
If you need some money then you can also take a loan from your PPF account. It is cheaper than personal loan. The interest rate for the loan is 1% more than the rate of PPF.
The loan facility is available from the third year to the sixth year. After that you also have the option to withdraw money from ppf account.
7. Premature Withdrawal | Premature Withdrawal
If you need money from the seventh year onwards you can withdraw half of your balance. Not only this, you can also withdraw full money by closing your ppf account for studies and treatment. PPF scheme has started this facility some time back.
8. No hidden charges. No Hidden Charges
Another good thing about PPF account is that you will not have to pay any hidden charges. Just a penalty. When you do not deposit a minimum of 500 rupees in any one year, then there is a penalty of fifty rupees.
If the money is not deposited in any year, you can deposit at least five hundred rupees with a penalty of fifty rupees in the next year. But except this, there is no charge anywhere.
9. No one can claim. No One can Claim PPF Amount
There is another great thing with the PPF scheme. No creditor can claim any money deposited in this account. Even if you become bankrupt, no one can take your money from you. But if there is tax liability then this money can be taken.
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