PPF Investment Formula: To create a huge fund, it is not necessary that you always take risks and invest in the market. If you want, you can earn a good amount from schemes with guaranteed returns. Especially when your goals are long term because in such a case you get a good benefit of compounding. On the other hand, if both husband and wife are working, then the power of investment doubles. In such a situation, both of you can together create a good fund. Here know how husband and wife can together create a corpus of more than 3 crores through PPF.
First understand these rules
According to the rules of PPF, a person can open only one PPF account in his name. There is also no option to open a joint account in PPF. But if both the wife and husband earn, then both can open separate accounts in their names. To add 3 crores, both of you have to do the same.
This formula has to be applied
To add Rs 3,09,00,000, both husband and wife will have to invest Rs 1.5 lakh annually in PPF and adopt the formula of 15+15.
Understand what 15+15 is
In the formula, the first 15 means the maturity period and the second 15 means the extension of 15 years which you will have to do three times in blocks of 5 each. In this way, both of you will have to invest Rs 1.5 lakh annually in PPF for 30 years.
Know how to create a fund of Rs 3,09,00,000
When both husband and wife deposit Rs 1.5 lakh annually from their respective accounts for 30 years, then they will invest Rs 45 lakh each annually from their respective accounts. Currently, PPF is getting an interest rate of 7.1 percent. If calculated according to this, both will get separate interest of Rs 1,09,50,911 on their respective accounts. In this way, both will get Rs 1,54,50,911 by combining the invested amount and interest. 1,54,50,911 X 2 = 3,09,01,822. In this way, you will be the owner of more than 3 crore 9 lakhs.
How will PPF extension happen?
For the extension of PPF, you will have to give an application to the bank or post office, wherever you have an account. You will have to give this application before the completion of 1 year from the date of maturity and a form will have to be filled for extension. The form will be submitted in the same post office / bank branch where the PPF account has been opened. If you are unable to submit this form on time, then you will not be able to contribute to the account.
This scheme will also save tax in 3 ways
One of the advantages of PPF is that it saves tax in three ways because this scheme is kept in the EEE category. The money deposited in PPF, the interest received and the amount received on maturity are completely tax free.
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