Although there are many investment options, Public Provident Fund (PPF) has special popularity among the employed people. Investing smartly in a PPF account can create a huge amount. The special thing is that the government also pays interest on the money deposited in the account. However, today we will tell you about a formula for investing in PPF account, which you can become a millionaire by following.
PPF scheme gets a high interest of 7.1 percent on one hand, on the other hand, the interest in this scheme is calculated in compound i.e. compound interest. This means interest is also paid on the interest along with the investment amount.
A maximum of Rs.1,50,000 can be invested
Investments in PPF scheme result in income tax savings every year, the interest credited to the account every year is taxable, and finally there is no tax to be paid on the amount received on maturity. This small savings scheme promotes long-term investment, and build a sizeable corpus for future needs. A maximum of Rs.1,50,000 can be invested in PPF per annum, and have to be invested for 15 consecutive years.
PPF Calculator for investment
PPF is a central government scheme. Meaning completely safe investment. The finance ministry decides its interest. Interest is calculated every quarter. At present, interest is being received at the rate of 7.1 percent. The investment is for 15 years. If you look at the calculation, then the total value of investment of Rs 12500 in a month will be Rs 40,68,209 after 15 years. The investment amount will be Rs 22.5 lakh and the interest will be Rs 18,18,209. Now if the plus the investment amount and the amount you will get from interest, than you can find a huge amount to your name or to tha name of the account holder.
How to be a crorepati?
If you invest Rs 405 every month in PPF, then according to this you will invest Rs 1,47,850 in a year. Now if you deposit the same amount in the PPF account for 25 consecutive years, then according to the current interest i.e. 7.1 percent interest, your PPF fund will be deposited more than Rs 1 crore.