Who doesn’t dream of becoming rich sitting at home? But if we say that without any risk, without market fluctuations and without any tension, you can get a tax-free amount of more than Rs 40 lakh in your account in the next 15 years, then it will certainly seem no less than magic. If you want to earn a large and tax-free amount in the long run without any risk, then the government’s Public Provident Fund (PPF) scheme is no less than a jackpot for you. Amidst rising inflation and market fluctuations, PPF is the option which gives safe and big returns to every common Indian. The special thing is that with proper planning, you can raise a huge amount of more than Rs 40 lakh in 15 years.
What is PPF and why is it such a profitable deal?
PPF i.e. Public Provident Fund is a long term investment scheme, which is run by the government. It is specially designed for those who have low risk appetite and want safe returns. By investing in this scheme, your money is not only completely safe, but you also get the interest fixed by the government every year. At present 7.1% annual interest is being given on PPF.
A fund of more than Rs 40 lakh can be created in 15 years
The maturity of PPF is 15 years. In this you can invest minimum Rs 500 and maximum Rs 1.5 lakh annually. If an investor invests Rs 1.5 lakh every year, he can get a tax-free amount of more than Rs 40 lakh after completion of 15 years. This amount is completely safe because it is not affected by market fluctuations.
You get great benefits in tax also
PPF is among the few selected schemes in India, which comes under the EEE (Exempt-Exempt-Exempt) category. This means tax exemption on investment (up to Rs 1.5 lakh under section 80C), no tax on interest and the entire maturity amount is tax-free. This is why it is difficult to find a better and safer tax saving option than PPF.
Who can open PPF account?
Any citizen of India can open a PPF account in his/her name. Accounts can also be opened in the name of children, which will be operated by their parents. NRI people cannot open a new PPF account, but the old account continues to operate till maturity.
Loan facility also
Not only can money be deposited in PPF, but if needed, a loan can also be taken between the third year to the sixth year.
Disclaimer: This is not an investment advice but just an information. Consult your financial advisors before taking any decision related to money.
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