PPF- In Indian society, it’s generally believed that managing household finances and building funds is solely the husband’s responsibility. However, this isn’t the case at all. The government runs schemes where you and your wife can invest together, potentially doubling returns and potentially saving substantial taxes.
The Public Provident Fund ( PPF) is one such scheme. PPF is a government scheme that promotes long-term investment. Investments in it fall under the EEE category. If you invest in PPF with your wife , you could become a millionaire in 20 years. Let’s understand the benefits of investing in PPF . How can you earn compound interest? What is the calculation for becoming a millionaire?
Who can open a PPF account?
Any individual can open this account in their own name at a post office or bank. Another person can also open an account on behalf of a minor. According to the rules , an individual can open only one account in his or her own name. There is no option to open a joint account in the Public Provident Fund. If both the husband and wife earn, then both can open separate accounts in their respective names.
How much interest is paid?
PPF offers a guaranteed interest rate of 7.1%. Investing in it is completely risk-free. This interest is compounded annually, meaning you earn interest on your money and then interest on that interest. This account can be opened for 15 years, which can be extended by another 5 years.
Investment Limits
An account holder can invest a minimum of Rs 500 and a maximum of Rs 1.5 lakh per year in a Public Provident Fund. If you are a couple, you can open two separate accounts. You can invest a maximum of Rs 1.5 lakh each per year, or a total of Rs 3 lakh.
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