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If you’re looking for a safe, tax-free investment for the long term, the Post Office PPF scheme could be an excellent option. This government scheme offers excellent returns and tax savings.
Big return on investment
The current interest rate on the PPF scheme is 7.1% per annum, which increases with compounding. This scheme can generate significant returns. Let’s consider an example:
After a period of 15 years, your total investment of ₹10.80 lakh will turn into approximately ₹19.52 lakh.
Key Features of PPF Scheme
- Minimum and maximum investment: You can deposit a minimum of ₹500 to a maximum of ₹1.5 lakh in a financial year.
- Lock-in period: The term of this plan is 15 years. You can extend it for 5 years each time if needed.
- Tax Benefits (EEE): The biggest advantage of PPF is its tax-free status. The investment amount, the interest earned, and the maturity amount are tax-free.
- Safe and reliable: This scheme is backed by the government, hence it guarantees capital protection, making it an excellent long-term investment.
Why is it important to invest in PPF ?
PPF is simply a disciplined and safe investment method for growing your money. If you invest ₹72,000 annually (i.e. ₹6,000 per month), your funds will nearly double in 15 years, providing a solid base for any major goals (like your children’s education or marriage).
