Nowadays everyone wants to invest. Every person chooses different investment options according to their needs. Some people invest in mutual funds or SIP, while some take less risk and choose government schemes like PPF or NPS. Every investment has its benefits, whether some give less or more. Today we will talk about two such investment options, SIP and PPF. If you are also confused about investment, then this information is for you only.

What is SIP

Systematic Investment Plan (SIP) is a market-based investment scheme, in which you can invest according to your financial situation. In this, you get options of different time periods, including monthly, three months and annual payment options. In this you get an interest of about 12%. There is no limit to invest in it, you can invest according to your needs starting from ₹ 100. This scheme is great for those who are interested in market-linked investments.

SIP Update
SIP Update

What is PPF

This is a savings scheme launched by the government, in which you can invest on an annual basis. Its maturity timeline is 15 years, although it can be extended on a 5-year basis. You can invest a maximum of Rs 1.5 lakh in it. Talking about annual interest, you get 7.1% interest on it. This scheme is ideal for those who want safe and guaranteed returns.

SIP vs PPF

If you want to invest in these schemes but are confused, then we can help you. Here we will tell you how much return you can get by investing in these schemes for 15 years. Let’s understand the calculation here. Here we will invest only Rs 1.5 lakh annually in both the schemes and see how much profit is made.

Investment in PPF

Suppose you invested Rs 1.5 lakh annually in PPF and after 15 years your total investment amount was Rs 22,50,000.

If you calculate it at the rate of 7.1% interest, you will get Rs 18,18,209.

That is, your total fund will now be Rs 22,50,000 + 18,18,209 = Rs 40,68,209.

Loan Against PPF
Loan Against PPF

Investment in SIP

Talking about SIP, if you invest Rs 1.5 lakh annually in it, then after 15 years at 12% interest rate you will have Rs 36,99,142.

That is, your final fund will be Rs 36,99,142 + 22,50,000 = Rs 59,49,142.

Which option is the best

If you are not afraid of taking risks and want to get higher returns, then you can think of SIP. However, it is a market-linked investment plan, so there is no guarantee of return in it. PPF is a safe savings scheme of the government, in which you get guaranteed interest. However, in this, you get less profit than SIP. In such a situation, if you want to avoid taking risks, then this will be the best option for you.