SpiceJet21 min ago
PPF vs SIP with Rs 1,01,010/year investment: Which can create higher corpus in 15 years?
- Written by Priya Vishwakarma
Published: Zee Business| Updated: Zee Business
SIP vs PPF Comparison: SIP and PPF are two long-term investments that help investors to accumulate wealth for their future financial needs. SIP, which is called a Systematic Investment Plan, is a mutual fund investment option that is linked to the stock market and allows investors to invest a fixed amount at regular intervals. PPF, which is called Public Provident Fund, is a government-backed scheme where investors can invest their money on a yearly basis and get stable returns.
SIP
Market-linked investment
Returns are not fixed and can fluctuate
People can invest as little as Rs 500 per month.
No maximum investment limit.
No lock-in period
Risk level is higher.
PPF
Offers guaranteed returns
Considered a safe investment
Minimum investment amount Rs 500/year
Maximum investment amount is Rs 1.5 lakh/year.
(Disclaimer: Our calculations are projections and not investment advice. Do your due diligence or consult an expert for financial planning.)
Image: AI-Generated & Getty Images
1/11
SIP vs PPF: Different in nature
1/11Both are long-term investment options, but differ from each other in various aspects such as maximum and minimum investment amount, maturity period, etc.
2/11
SIP vs PPF: Comparing both the investment options
2/11Investment amount: Rs 1,01,010 per year Time: 15 years In this write-up, we will compare both the investment options by investing Rs 1,01,010 per year for 15 years separately to see which option will give higher returns.
3/11
PPF Vs SIP: What rate of return are we using for the calculation?
3/11For SIP calculations, we're assuming a 12 per cent annual return rate. While PPF is a government scheme that offers a fixed interest rate. So we are using 7.1 per cent rate for all the calculations.
4/11
SIP investment with Rs 1,01,010 annually: How much money do you need to invest every month?
4/11As per the calculations, if you invest approximately Rs 8,417 every month or Rs 1,01,010 annually for 15 years, the total investment will be around Rs 15,15,060.
5/11
SIP investment with Rs 1,01,010 annually: How much capital gain can be earned after 15 years?
5/11Capital gains of approximately Rs 24,90,855 can be earned in 15 years.
6/11
SIP investment of Rs 1,01,010 annually: How much money can one get after 15 years in SIP?
6/11The total corpus generated at the end of 15 years would be approximately Rs 40,05,915.
7/11
SIP investment calculations (with 12% annual interest rate):
7/11Monthly investment: Rs 8,417 Total investment (15 years): Rs 15,15,060 Estimated returns: Rs 24,90,855 Total value: Rs 40,05,915
8/11
PPF investment of Rs 1,01,010 annually: Total amount to be invested in 15 years
8/11As per the calculations, if you invest Rs 1,01,010 annually for 15 years, the total investment will be around Rs 15,15,150 (almost the same as you are investing in SIP above).
9/11
PPF investment of Rs 1,01,010 annually: How much interest will be earned after 15 years?
9/11An interest of Rs 12,24,382 will be earned in 15 years.
10/11
PPF investment of Rs 1,01,010 annually: How much money can one get after 15 years in PPF?
10/11The final corpus generated at the end of 15 years will be Rs 27,39,532.
11/11
PPF investment calculations (with 7.1% annual interest rate):
11/11Annual Investment: Rs 1,01,010 Total Investment (15 years): Rs 15,15,150 Estimated Returns: Rs 12,24,382 Total Corpus: Rs 27,39,532
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