PPF Scheme: By investing Rs 1,000 in PPF every month, up to Rs 18 lakh can be obtained. Starting investing Rs 1,000 in PPF early in your career will ensure that you get a decent amount back when you start planning for your retirement.
PPF Scheme: Amidst a volatile global economy and the ongoing pandemic, saving for the future becomes crucial. Saving as much money as you can is a prudent financial practice. In such a situation, saving plans giving high returns on long-term savings are an attractive option. Let us know about one such scheme, the PPF scheme, which can give returns of more than Rs 18 lakh on a modest monthly investment of Rs 1,000.
PPF is a scheme that guarantees return on investment. In 1968, the National Savings Organization was instructed to make a profitable investment option out of small savings. If the investment in PPF is done properly, then investors can expect very good returns in the long term.
Currently offering an interest rate of 7.1 per cent, Public Provident Fund offers an option to deposit between a minimum of Rs 500 and a maximum of Rs 1.5 lakh every year. The maturity period of PPF account is 15 years. An individual has the option to withdraw the money after the account matures or to extend the account in blocks of 5 years.
An investment of Rs 1,000 every month for a period of 15 years will take their deposits to Rs 1.80 lakh in 15 years. With an interest rate of 7.1%, you will earn an interest of Rs 1.45 lakh, taking the total amount in the PPF account to Rs 3.25 lakh. With a monthly deposit of Rs 1,000 for a period of 5 years, this amount will increase from Rs 3.25 lakh to Rs 5.32 lakh. For the second 5 year extension, this amount will be Rs 8.24 lakh.
The third 5 year extension takes this amount from Rs 8.24 lakh to Rs 12.36 lakh as the total investment tenure reaches 30 years. The fourth extension in the initial 15-year period will take the total amount to Rs 18.15 lakh after the investment period of 35 years.
Starting investing Rs 1,000 in PPF early in your career will ensure that you get a decent amount back when you start planning for your retirement.
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