To ensure a steady income even after retirement, it is essential to invest alongside your job. The Public Provident Fund (PPF) is an excellent option for building a substantial retirement fund and is widely popular among individuals.
By investing in PPF, you can accumulate a significant corpus. This scheme not only offers a high interest rate of 7.1% but also calculates interest on a compound basis, meaning you earn interest on both your investment and the accrued interest. Through the PPF scheme, you even have the potential to become a millionaire. In this article, we will explain how much wealth you can generate by investing consistently in PPF for 15 years.
How Much Money Will Your PPF Fund Grow Into?
Monthly Investment of ₹500
If you invest ₹500 every month, your annual investment will be ₹6,000. Over 15 years, your total investment will amount to ₹90,000. With an interest of ₹1,56,728.37 earned, your total fund after 15 years will be approximately ₹1,62,728.
Monthly Investment of ₹1,000
For a monthly investment of ₹1,000, your yearly contribution will be ₹12,000. In 15 years, this adds up to a total investment of ₹1,80,000. You will earn an interest of ₹3,13,456.74, resulting in a final PPF fund of ₹3,25,457.
Monthly Investment of ₹2,000
If you invest ₹2,000 every month, you will contribute ₹24,000 annually. Over 15 years, your total investment will be ₹3,60,000. This will yield an interest of ₹6,26,913.48. After 15 years, your total PPF fund will amount to ₹6,50,913.
Rules for Maintaining Multiple PPF Accounts
If an individual holds more than one PPF account (PPF Calculator), interest will only be paid on the primary account at the applicable rate, provided the annual deposits stay within the maximum limit. The funds from the secondary account will be merged with the primary account, but this condition applies only if the primary account remains compliant with the prescribed investment limit.
Accounts other than the primary and secondary will not earn any interest. The amount in such accounts will be refunded at zero per cent interest from the date they were opened.