Post Office Scheme: Everyone wants that a part of their hard earned money should be invested in a safe place. They should also get good returns on it. In such a situation, the saving schemes of the post office are the first choice of the people, because they come with full government guarantee.
Post Office Scheme: Everyone wants that a part of their hard earned money should be invested in a safe place. They should also get good returns on it. In such a situation, the saving schemes of the post office are the first choice of the people, because they come with full government guarantee. One of these is the Public Provident Fund (PPF), which is considered to be the most reliable and the best option for tax-free investment.
Why is it special?
By investing in PPF, you get 7.1% annual interest. This interest is completely tax-free. Not only this, the amount invested in the scheme, the interest received on it and the entire interest received on maturity, everything is completely tax free. This is why it is called EEE (Exempt-Exempt-Exempt) scheme. There is a lock-in period of 15 years. This means that you cannot withdraw the money completely in between, but if needed, you are allowed to take a loan and withdraw some money.
Start with just Rs 500
If you are thinking that such a big scheme requires a lot of money, then it is wrong. You can open an account in PPF with just Rs 500. A maximum of Rs 1.5 lakh can be invested in a financial year. The method of investing is flexible. Whether you invest money every month or deposit the money in one go. Even after the completion of the 15-year period, if you want, you can extend it for 5-5 years and make your fund even bigger.
This is how a fund of Rs 40 lakh will be created
Suppose a person invests a maximum of Rs 1.5 lakh every year in this scheme. That is, about Rs 12,500 every month. If he does this for 15 years, his total investment will be Rs 22.5 lakh. The interest received on this will be around Rs 18.18 lakh. That means after 15 years, the total amount in the hands of the investor will be around Rs 40.68 lakh. Imagine, with regular savings, you can climb the first step to becoming a millionaire.
- An account can be opened in any bank or post office.
- You can take a loan on your PPF balance in the initial years itself.
- The option of partial withdrawal is available after the completion of 5 years of the account.
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