PPF Calculation: How much will you earn in 15 years by investing Rs 2,000, Rs 6,000, and Rs 10,000 monthly in post office Public Provident Fund?
The Public Provident Fund (PPF) is a safe way to save for retirement. You put your money in for 15 years, and then you can add more time in 5-year blocks.
If you want a safe way to save for retirement, the Public Provident Fund (PPF) from the post office is a good option. You can start with just Rs 500 and grow your money in the long run. Since it is backed by the government, it is a secure investment. Right now, PPF offers a 7.1 per cent fixed interest rate, helping your investment grow with compounding. It has a 15-year lock-in period and also provides tax benefits, making it a great choice for long-term financial planning.
Photos source: Pixabay/Representational
(Disclaimer: Our calculations are projections and not investment advice. Do you own due diligence or consult an expert for financial planning)
PPF account: Bank or post office; which is better?
If you are thinking about where to open a PPF account, you might wonder whether a bank or post office is better. But there’s no big difference, both follow the same rules and offer the same benefits.
Who can open a PPF account?
1. Resident Indian Adult: A single adult who is a resident of India can open a PPF account.
2. Guardian for Minor/Person: A guardian can open a PPF account on behalf of a minor or a person.
Only one PPF account can be opened across the country, either in a post office or a bank.
Post office PPF account deposit rules
1. Minimum and Maximum Deposit: The minimum deposit required in a financial year is Rs 500, while the maximum deposit allowed is Rs 1.50 lakh.
2. Combined Deposit Limit: The maximum limit of Rs 1.50 lakh applies to the combined deposits made in: Your own PPF account or a PPF account opened on behalf of a minor.
What are PPF account maturity options?
The account matures after 15 financial years, excluding the financial year of account opening.
On maturity, the depositor has the following options:
The depositor can take the maturity payment by submitting the account closure form along with the passbook at the concerned Post Office.
The depositor can retain the maturity value in the account without making further deposits, and the applicable PPF interest rate will still be earned; the payment can be taken at any time, or one withdrawal can be made per financial year.
The depositor can extend the account for a further block of 5 years, and so on, within one year of maturity, by submitting the prescribed extension form at the concerned Post Office.
What are PPF account withdrawal rules?
Here are the rules regarding withdrawals from a PPF account:
A subscriber can make one withdrawal per financial year, but only after five years from the date of account opening, excluding the year of account opening.
The amount of withdrawal allowed is up to 50 per cent of the balance credited to the account at the end of the fourth preceding year or the end of the preceding year, whichever is lower.
Post office PPF calculation conditions
Investment amount: Rs 2,000, Rs 6,000, Rs 10,000
Annualised rate of return: 7.1 per cent
Investment period: 15 years
What will be PPF corpus after 15 years with an investment of Rs 2,000 per month?
Annual investment: Rs 24,000 (2,000x12)
Your total investment amount over 15 years will be Rs 3,60,000. The estimated interest earned during this period will be Rs 2,90,913 and the estimated maturity amount will be Rs 6,50,913.
What will be PPF corpus after 15 years with an investment of Rs 6,000 per month?
Annual investment: Rs 72,000 (6,000x12)
Your total investment amount over 15 years will be Rs 10,80,000. The estimated interest earned during this period will be Rs 8,72,740 and the estimated maturity amount will be Rs 19,52,740.
What will be PPF corpus after 15 years with an investment of Rs 10,000 per month?
Annual investment: Rs 1,20,000 (10,000x12)
Your total investment amount over 15 years will be Rs 18,00,000. The estimated interest earned during this period will be Rs 14,54,567 and the estimated maturity amount will be Rs 32,54,567.