PPF Account Calculation : Are you interested in beginning to invest or seeking a method to make good money from interest? Or are you seeking an investment that carries no risk? In this scenario, the Public Provident Fund (PPF) scheme is the optimal choice. Any individual from India is allowed to invest in it. The main aspect is that the advantages offered in it continue to be the most favored. The advantages of putting money into PPF are communicated by the banks and post offices themselves. Attractive interest, tax-exempt investment, the funds obtained at maturity are entirely yours. It is a superb resource from an investment perspective. The duration until maturity is 15 years.
However, you can extend the investment even beyond 15 years. If you allow an extension, your return (PPF return) will grow incredibly fast, and you’ll observe how the initial investment of Rs 5000 transforms into over 26 lakhs. When it reaches maturity, you have three choices. It is crucial to comprehend these three choices. First, take out your funds after they reach maturity. Secondly, even if you don’t take any money out, you will keep receiving interest. Third, you can provide an extension for 5 years with fresh investment. Let’s figure out how and what actions to take.
Upon maturation of the PPF account, withdraw the sum you deposited along with the interest earned. If the account is closed, the full amount will be sent to your account. The funds and interest obtained at maturity will be entirely tax-exempt. In addition to this, there is an income tax exemption for investments up to Rs 1.5 lakh annually. You will not be required to pay any taxes on the funds deposited throughout the whole duration.
The alternative choice is to boost the investment following maturity. The plan provides the choice of extending accounts in periods of 5 years each.
You will continue to earn interest on the deposited sum
The maturity will automatically rise over a period of 5 years. However, the main benefit will be that you will continue to earn interest on the deposited sum throughout this whole duration. Following this, upon finishing the five-year period, it can be renewed once more in a similar manner.
How can ₹5000 turn into ₹26.63 lakh?
At present, the Public Provident Fund offers an interest rate of 7.1%. Interest is computed on a yearly basis. However, it is determined on a quarterly basis. Its interest rates have remained unchanged for an extended period. Let us consider that investing at the same interest rate over 15 or 20 years will lead to a significant wealth accumulation on varying amounts.
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