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PPF Scheme: Everyone saves small or big amounts from their hard-earned money in the hope that they will not face any financial problems after retirement. However, to achieve this goal, one needs to invest his savings in the right place. If you also want to collect a large fund, then you can invest in PPF scheme.
Safe investments and tax benefits
Investing in PPF scheme is a profitable deal in the long term. In fact, along with tremendous interest, the government also guarantees safety on your deposits. The return on investing in this is absolutely tax free. The benefit of compound interest is also available in this scheme. Along with this, you can also avail tax exemption on investment in PPF under section 80C of Income Tax.
You can invest this much every year
Investors can start investing in PPF with just Rs 500, while a maximum of Rs 1.5 lakh can be invested in a year. The maturity period in this scheme is 15 years, which means you can invest for this long, but if you want to continue investing even after maturity, then in such a situation there is also a facility to extend the PPF account for 5-5 years. However, for this, one has to apply one year before the maturity is completed.
This much profit by investing 5000 rupees per month
Now how can an investor raise a fund of Rs 42 lakh by saving only Rs 5000 every month? Before calculating this, know that this scheme gives interest at the rate of 7.1 percent on investment. By depositing Rs 5000 per month, Rs 60,000 will be deposited in the PPF account in a year and the total deposit amount will become Rs 9,00,000 in 15 years. At the same time, according to the fixed interest rate on the amount deposited by you, you will get interest of Rs 7,27,284, that is, by then your deposited fund will become Rs 16,27,284.
Now if you extend this fund for 5-5 years, then your total deposited fund will also increase accordingly. That is, if you extend it for 10 years, that is, after 25 years, the total fund including interest on the amount deposited by you will be around Rs 42 lakh. The interest income you will get in this 25-year period will be more than Rs 26,00,000.
Loan facility is also available in this scheme
In PPF scheme, you get the facility to invest in lump sum or in installments. Talking about its other benefits, emergency fund withdrawal can also be done from this scheme with one year maturity, however, investors cannot withdraw more than 50 percent of the amount. According to the condition laid down for this, the investment period should be 6 years. At the same time, you can also take a loan under it only after investing for 3 years.