If you have invested in a Public Provident Fund (PPF) or are planning to, here’s some great news! This government-backed scheme offers secure and guaranteed returns, and investors can accumulate up to ₹27.1 lakh over time.
With the stock market experiencing volatility, many investors are facing losses. If you prefer a risk-free investment that provides stable returns, PPF is an excellent choice.
What is PPF and How Does It Work?
PPF is a government-managed savings scheme designed for long-term investment. Since it is backed by the government, it offers complete security for your money. Currently, the scheme provides an annual interest rate of 7.1%, which is compounded yearly.
You can open a PPF account at any bank or post office, making it easily accessible. The minimum deposit required per year is ₹500, while the maximum contribution is ₹1.5 lakh annually. You can invest either in a lump sum or through multiple installments throughout the year.
How Much Can You Earn with PPF?
A PPF account matures after 15 years, allowing you to accumulate a substantial corpus. If you invest ₹1 lakh every year, your total amount at maturity will be ₹27,12,139. This includes your ₹15 lakh principal amount and ₹12,12,139 in interest earnings. Since the interest is compounded annually, your savings grow significantly over time.
Who Can Open a PPF Account?
Any Indian citizen can open a PPF account. Parents can also start a PPF account for their minor children, ensuring a secure financial future for them. However, each individual can have only one PPF account in their name.
Why Should You Consider PPF?
PPF is a safe and tax-efficient investment option. Since it falls under the Exempt-Exempt-Exempt (EEE) category, your investment, interest, and maturity amount are completely tax-free. The returns are guaranteed and not linked to market risks, making it ideal for retirement planning, education savings, or general wealth accumulation.
Final Thoughts
If you want a stable, long-term investment without worrying about market fluctuations, PPF is an excellent option. It not only provides secure and guaranteed returns but also helps you build a strong financial future. Whether you’re saving for yourself or your family, investing in PPF can be a smart and stress-free financial decision.