PPF Calculator: Public Provident Fund (PPF) is a long term investment scheme that enables an investor to meet his financial requirements even after retirement. As per PPF rules, investors can deposit Rs 100 in their PPF account at any bank or nearest post office. ppf account can open. However one needs to deposit a minimum of 500 per year in his PPF account.
The PPF account has a lock-in period of 15 years, wherein an earning individual can deposit up to Rs 1.5 lakh in a single deposit or a maximum of 12 installments in a financial year.
According to tax and investment experts, the PPF account comes under the EEE category, where a person can claim income tax exemption under Section 80C of the Income Tax Act on deposits up to Rs 1.5 lakh per annum. Apart from this, tax exemption is also available on PPF maturity amount. The PPF interest rate is 7.1 percent payable on a quarterly basis and if a person maintains investment discipline, he/she can retire as a millionaire at the time of maturity of the PPF account.
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Get maximum returns from PPF account like this
The maturity period of PPF account is 15 years. Enables the investor to continue with this risk-free investment option without withdrawing the PPF maturity amount. While extending one’s PPF account for the next 5 years one has the option of extension without investment or extension without investment.
Explain that when you are expanding your PPF account, you should choose the extension with investment option as it will enable you to earn interest on both the PPF maturity amount and fresh investments. If a person does this, he can expect to retire as a millionaire. A person can deposit more than one crore in his PPF account at the time of retirement.
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Calculate like this
If an earning person opens a PPF account at the age of 30 years and extends his PPF account three times for further 5-5 years, then in that case the PPF account holder will be able to invest in the PPF account for 30 years. Suppose an investor invests Rs 1.50 lakh per year in one’s PPF account, then after 30 years of investment one’s PPF maturity amount will be Rs 1,54,50,911 or approximately Rs 1.54 crore. The PPF interest rate will be flat 7.10 per cent per annum for the entire tenure.
According to the PPF calculator, the investor’s investment in these 30 years is only (1.5 lakh x 30) 45 lakh. While the PPF interest earned is Rs 1,09,50,911.
