Post Office Scheme: There is a tremendous option in the government’s small savings schemes to create a guaranteed corpus from a long-term perspective. One of these options is Public Provident Fund (PPF).
Post Office Scheme: There is a tremendous option in the government’s small savings schemes to create a guaranteed corpus from a long-term perspective. One of these options is Public Provident Fund (PPF). PPF account can be opened in any branch of the post office. Apart from this, PPF account can also be opened in designated banks.
From January 1, 2023, 7.1 percent interest is being received annually on the PPF account. In this compounding of interest is done on an annual basis. The maturity of PPF account is 15 years. That is, it is a long term investment option.
That is, PPF is a better option for those who aim to create funds for the future. One of its specialty is that there is no market risk on investment in it. Apart from the investment being safe, the returns are also guaranteed.
PPF account will be opened with ₹ 500
PPF can be opened with a minimum of Rs 500. In this, a maximum of Rs 1.50 lakh can be deposited in a financial year. There is a facility to extend this account further in the bracket of 5-5 years after maturity.
Guaranteed security on every penny deposited in the post office. Whereas in banks, insurance is available only for an amount up to 5 lakhs. That is, if the bank sinks, only your amount of 5 lakhs will be safe.
This is how a fund of 1.5 crores will be made
You can invest a maximum of Rs 1.50 lakh in a PPF account in a year. Suppose, you invest Rs 12,500 every month in a PPF account. After maturity in 15 years, you can extend your PPF account in blocks of 5-5 years. In such a situation, after 30 years, the entire fund of your PPF account will be more than 1.5 crores (1,54,50,911). In this, your investment will be 45 lakhs and interest income will be around Rs 1.09 crores.
You can start investing in 25 years
Let us tell you that the sooner you start investing in this government scheme, the more it benefits. Suppose you are 25 years old and you invest 1.5 lakh rupees annually in PPF, then at the age of 55, that is, about 5 years before retirement, you can become a millionaire.
How is interest calculated on PPF?
Interest is calculated every month on PPF, but it is credited to the account at the end of the financial year. That is, whatever interest you earn every month is put in your PPF account on 31st March. However, there is no fixed date for when to deposit money in the PPF account. You can deposit money in PPF monthly, quarterly, half yearly and annually.
How to get higher interest on PPF
Let us now explain how interest is calculated. Interest on PPF is calculated on the amount in the account from 1st to 5th of every month. That is, if you put money in the PPF account till the 5th of any month, then interest will be received on that money in the same month, but if you deposited the money after the 5th ie on the 6th, then the interest on the deposited amount will be available for the next month. will get.
Simple Example of PPF Calculation
Let us understand this PPF calculation with an easy example. By which you will come to know how you can get more interest by investing money at the right time.
Example No.-1
Suppose you deposited Rs 50,000 in your account on 5th April, you already have Rs 10 lakhs in your account as on 31st March. From April 5 to April 30, the total amount in your PPF account was Rs 10,50,000, which is the minimum balance. So the monthly interest on it at the rate of 7.1% is – (7.1%/12 X 1050000) = Rs 6212
Example number-2
Now suppose you did not deposit the amount of Rs 50000 till 5th April and then deposited it on 6th April. From April 5 to April 30, the minimum balance in your account will be Rs 10 lakh. What is the monthly interest on this at the rate of 7.1%
(7.1%/12 X 10,00,000) = Rs 5917
If you deposit with this trick, you will get more interest
Imagine, the investment amount is only 50,000, but the method of deposit made a difference in the interest. In such a situation, if you want maximum interest on your money in PPF, then keep this trick in mind and deposit the money by the 5th of the month so that you definitely get the interest for that month. Experts also advise that investment of 1.5 lakh on PPF is tax exempt, so if you want to take this tax exemption, then deposit the entire amount of 1.5 lakh between April 1 and April 5 as soon as the new financial year starts. Give. If you are not able to do this, then deposit the money by the 5th of every month.
