PPF Investment- Deposit Rs 1.5 Lakh Annually, Know How Much You’ll Get at Maturity

PPF: The Central Government runs a variety of government schemes, of which the Public Provident Fund (PPF) is a special scheme. By investing in this scheme, you can create a corpus of Rs 1 crore. You can start investing with just Rs 500. The Public Provident Fund (PPF) is an excellent investment option. You can avail this scheme from any government bank, post office, or private bank.

The maximum annual investment in this account is Rs 1.5 lakh and the maximum monthly investment is Rs 12,500. This account offers better returns than many small savings schemes, including fixed deposits. The maturity period of PPF is 15 years, but you can extend it in 5-year increments.

PPF Interest Rate

The Public Provident Fund, which is a long-term savings initiative by the Government of India, currently provides an interest rate of 7.1 percent. The Ministry of Finance regularly assesses the PPF interest rate. A PPF account has a maturity period of 15 years. You can only open a PPF account at a bank or a post office, meaning you cannot have more than one account. The maximum amount you can deposit in this account is Rs 1.50 lakh each year. Depositing more than this amount in a single year is not allowed.

Calculating Returns on a Rs 1,50,000 Deposit

If you make your deposit in April, which is the start of the financial year, you will earn interest for the full year. It is advisable to make this deposit by the 5th of the month. So, if you deposit Rs 1,50,000 in April, based on the PPF interest rate of 7.1 percent, after the maturity period of 15 years, you will accumulate a substantial amount of Rs 40,68,209. This total includes Rs 22,50,000 that you invested and Rs 18,18,209 as the interest earned from this investment.

Know these things

• A minimum deposit of Rs 500 is required to keep the account active in any given financial year.
• You can invest a maximum of Rs 1.5 lakh in a year.
• Amounts above this amount are not eligible for interest or tax benefits.
• PPF is one of the few investments that falls under the EEE (Exempt-Exempt-Exempt) category. The amount invested is tax-deductible (under Section 80C). The annual interest earned is tax-free. The entire maturity amount is completely tax-free.
• The original maturity period of PPF is 15 years. However, if you want to grow the fund further, it can be extended indefinitely in 5-year blocks after maturity.