Are you looking for a risk-free, guaranteed return, and a completely tax-free investment Then, the PPF (Public Provident Fund) is the best and most powerful option for you! This excellent government-backed scheme matures in 15 years, which you can extend in 5-year blocks. Investors can deposit up to ₹1.5 lakh annually. Currently, this scheme offers a fixed interest rate of 7.1%. If you and your wife invest smartly in this scheme, it’s very easy to become millionaires in just 20 years! Let’s learn about this foolproof strategy and the complete math.
Key Takeaways
Quick Read- How can triplets become millionaires jointly
- Complete Process of Becoming a Crorepati in 20 Years
- Triple Bang of Tax Benefits (E-E-E)
- Don't Miss the Extension Deadline
How can triplets become millionaires jointly
There’s no option to open a joint account in PPF, but there’s a simple solution. Both husband and wife can open separate PPF accounts in their own names. If both contribute the maximum ₹1.5 lakh annually, their total investment will reach ₹60 lakh in 20 years, and with interest, this amount will exceed ₹1.33 crore. This means that together they will be playing in crores, not millions!
Complete Process of Becoming a Crorepati in 20 Years
To become a crorepati, you need to adopt a simple but consistent investment strategy. Both husband and wife will need to deposit ₹1.5 lakh every year, or ₹12,500 every month. The plan will mature in 15 years, after which it will have to be extended for another 5 years.
Thus, if they continue investing annually for 20 years, their total investment will be ₹60 lakh. At a compound interest rate of 7.1%, this total amount will become ₹1,33,16,576. Suppose both deposit ₹30 lakh. Over 20 years, each will earn ₹36,58,288 in interest. A total of ₹66,58,288 will be deposited in each account. The total is ₹1,33,16,576.
Triple Bang of Tax Benefits (E-E-E)
The biggest feature of PPF investment is its E-E-E tax benefit. This means that the invested amount is tax-exempt (Section 80C), the interest earned is tax-free, and the maturity amount is also completely tax-free. This means that your entire return is 100% tax-free.
Don’t Miss the Extension Deadline
After 15 years of maturity, you can extend your PPF account for another 5 years. If you wish to continue contributing, submit Form H to your bank or post office within one year of the maturity date. If you fail to apply on time, contributions to the account will stop, and interest may be reduced.
The Most Powerful Scheme for Safe Investment
PPF is a fully government-guaranteed scheme. There is zero market risk and no fear of capital loss. Over the long term, this scheme grows rapidly due to compound interest every year, creating a tax-free corpus of crores in 15-20 years.
