Public Provident Fund (PPF) accounts are widely known for offering guaranteed returns with tax benefits on investments of up to 1.5 lakh annually under Section 80C of the Income Tax Act. Any individual, be they employed, self-employed or pensioners can open an PPF account; both post offices and banks offer similar account opening procedures and benefits.
The government supports Post Office Public Provident Fund with tax benefits and guaranteed returns that help secure your financial future. Currently, they’re offering an interest rate of 7.1 percent – so if you want a hassle-free investment with guaranteed tax breaks and returns then take a look at this scheme! Here we will show how much Rs 4,000, Rs 8,000 or Rs 12,000 monthly investment could net in 20 years; let’s see!
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Post Office Public Provident Fund
Public Provident Fund (PPF) at the post office provides you with a savings plan to help secure your long-term financial future. With tax advantages and guaranteed returns from government backing, this savings vehicle provides long-term security of savings funds.
What are the eligibility requirements to open a PPF account?
Anyone can open a PPF account, including: Employed people; Self-employed people and pensioners.
Eligibility criteria to open a PPF Account
Guardians may open PPF accounts on behalf of minors and people unable to manage their own finances.
Note: Each individual in the UK can open only one Personal Pension Fund account at any one time – either through their post office or bank.
Post Office PPF Minimum Deposit Amount is $5,000 USD
Minimum annual deposits required is Rs 500 while maximum annual contributions allowed is up to 1.50 lakh (Combined Deposit Limit ). It applies both for deposits made to your own PPF account as well as those opened on behalf of minors.
Where can I open a PPF account?
Your PPF account can be opened at either a bank or post office; both accounts come with similar rules and benefits, so choose whatever is most suitable to you.
PPF accounts typically mature between three and five years from their opening.
This account matures after 15 financial years (excluding the year in which it was opened ).
What to Do Once PPF Has Matured
- Receive Your Maturity Amount: Fill out and submit the Account Closure Form along with your passbook in order to collect your money as part of its maturity amount.
- Keep Your Money in an Account: Rather than withdrawing the maturity amount immediately upon reaching maturity, why not leave it in an account to accumulate interest until your next withdrawal? Either make regular withdrawals, or plan one annual one-time payments to yourself?
- Extend Your PPF Account: Within one year of maturity, your PPF account can be extended for another five years by submitting an extension form at your post office.
What are the PPF withdrawal rules?
Here are the rules regarding withdrawals from a PPF account: You are permitted to withdraw one amount every financial year after five years from opening an account (not including the year of account opening itself).
Withdrawals may reach 50% of the balance credited to an account at either the end of the fourth preceding year or at the end of the previous year – whichever amount is smaller.
Post Office PPF Calculation Conditions
Investment amounts: Rs 4,000, Rs 8,000 and Rs 12,000
How much would your PPF corpus grow after investing Rs 4,000 each month for 20 years?
Annual Investment Amount: Rs 48,000 (12×400). Your 20 year total investment amount will total Rs 9,60,000 with estimated interest earnings reaching an estimated total of Rs 11,70,652; estimated maturity amount being 2130652.
What will my PPF corpus look like after 20 years if I invest Rs 8,000 monthly?
Annual investment: Rs 96,000 (8 x12). Your total investment over 20 years will total Rs 19,20,000; with estimated interest accruing during that time amounting to an estimated 23,41,304 in earnings and 42 61 304 as the expected maturity amount.
What will the PPF corpus look like after 20 years with monthly contributions of Rs 12,000?
Annual Investment Amount: Rs 1,44,000 (12×120). Your 20 year total investment amount will be Rs 28,80,000; estimated interest earned during that time will total Rs 35,11,957 and maturity estimate is expected to reach 63,91,957.
