PPF– You will become a millionaire by investing Rs 12,500 every month, Know the strategy

PPF Plan- Good news for investors. Whenever the question of safe investment arises, usually FD, gold or PPF comes to people’s mind. The general perception about Public Provident Fund (PPF) is that it is a safe way to save tax and save a small amount for retirement. These days the central bank has made a big cut in the repo rate. After this, banks have also cut interest rates on FD and savings accounts. This may reduce people’s income. In such an environment, you can turn to PPF. There is no risk of any kind in investing here.

You can also plan to become a millionaire through PPF. With the 15+5+5 strategy of investing in PPF, you can raise a fund of crores in 25 years. You can also arrange for a hefty pension on this amount. PPF is completely a government scheme. This means that there is no market risk on your investment. While the stock market keeps fluctuating, PPF gives a stable and reliable return.

Interest in PPF

Currently, PPF is giving 7.1 percent annual interest. This interest is compounded every year, that is, you get interest on your money and then interest gets added on that interest as well. This power of compounding makes PPF so special. The interest received in this and the amount received on maturity are tax-free. In this scheme, you can invest a minimum of Rs 500 and a maximum of Rs 1.5 lakh every year.

You will become a millionaire by investing Rs 12,500 every month

If you invest Rs 12,500 every month in PPF, then this amount reaches Rs 1.5 lakh in a year. The maximum amount you can invest in PPF in a year is Rs 1.5 lakh. If you extend this scheme twice for 5 years each after 15 years, then after a total of 25 years you can have a fund of about Rs 1.03 crore. Out of this, you will get a profit of more than Rs 65 lakh from interest alone.

If your income is limited and you can deposit only Rs 4,585 every month, even then if you continue investing in PPF, you can become the owner of Rs 1 crore in about 35 years. That is, if you start in the initial phase of the job and maintain the investment till retirement, then becoming a millionaire is almost certain.

The basic period of PPF scheme is 15 years. But after completion of 15 years, you have two options. First, you can withdraw all your money or take two extensions of 5 years each. You can also leave your money without investing in these 10 years. If you continue investing, you will create a bigger amount. If you do not deposit the minimum amount in any year, then in such a situation the account may default. But it can be restarted, for which some late fees have to be paid along with the minimum subscription amount.

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