Retirement Savings Scheme: Everyone wants to have a regular income after retirement. Keeping this need in mind, many schemes are being run by the government. You can secure your future by investing in these schemes. Meanwhile, many people are confused as to which scheme will give more benefits if invested in. These days there is a lot of discussion about NPS, EPF and PPF. If you also invest in these schemes, then let us know which scheme will be better for you.

 

Public Provident Fund (PPF)

PPF is a government scheme that allows long-term savings. In this, you can invest a minimum of Rs 500 and a maximum of Rs 1.5 lakh every year. It has been designed keeping in mind those people who are looking for risk-free investment options with tax benefits. The maturity period in PPF is 15 years. It can be extended in blocks of 5 years each.

The government pays interest at the rate of 7.1 percent per annum on PPF account. The interest rate on PPF is decided by the government every quarter. There is no risk of any kind in investing in it. Under Section 80C, tax exemption is available on investment up to Rs 1.5 lakh annually on PPF.

EPF

Employee Provident Fund is called EPF in short. It is operated by the Employees Provident Fund Organization. The government guarantees returns on depositing money in the EPF account. When employees retire after working for 30 years, they get a lump sum amount at the time of retirement. Both the company and the employee contribute 12 percent of the basic salary and dearness allowance to EPF . Investing in EPF provides tax exemption of up to Rs 1.5 lakh under section 80c.

 

NPS

NPS i.e. National Pension System is a voluntary scheme run by the government. Any Indian citizen between 18 and 70 years can invest in this scheme. Even NRIs can invest in it. In this, the investor can choose a mix of equity, corporate bonds and government securities as per his choice.

This scheme has been giving an annual return of 8% to 10%. Although money in NPS cannot be withdrawn till the age of 60, the tax exemption is quite attractive. Under Section 80C of the Income Tax Act, ₹ 1.5 lakh and an additional ₹ 50,000 is available under 80CCD (1B) .

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