SIP vs PPF for Rs 85,000/year investment: Which can create higher corpus in 15 years?
SIP vs PPF: Systematic Investment Plan and Public Provident Fund are two long-term investment options that can generate a substantial corpus. Let's learn about them and compare their return for an investment of Rs 85,000 per year over 15 years.
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SIP vs PPF: Systematic Investment Plan (SIP) and Public Provident Fund (PPF) are two long-term investment options. Those who prefer risk-free schemes choose PPF while those who can take on risk opt for an SIP mutual fund. Both are different in nature such as return rate, maturity period, and investment limit. Let's learn about them and compare their return for an investment of Rs 85,000 per year over 15 years.
| SIP | PPF |
| Market-linked investment option | Government-backed savings scheme |
| Can invest money based on financial capacity | Can invest maximum of Rs 1.5 lakh per year |
| Offers average long-term return of 12% | Offers an interest rate of 7.1% |
| Can invest invest monthly, quarterly, or yearly | Maturity and lock-in period is 15 years |
| High Risk | Low risk |
| No lock-in period, investor gets to choose | Maturity and lock-in period is 15 years |
SIP vs PPF: How Much Corpus You Can Generate in 15 Years?
Suppose you are investing Rs Rs 85,000 annually in both SIP and PPF. Now, can you guess how much corpus you can generate in 15 years? Let's calculate
SIP Investment Calculation: How Much Corpus Will You Generate in 15 Years with Rs 95,000 Annual Investment?
If you invest Rs 85,000 yearly in SIP (Rs 7,083 per month), your total investment will amount to Rs 12,74,940 in 15 years. Assuming an average annual return of 12 per cent, the total corpus generated at the end of 15 years would be approximately Rs 35,73,912, including Rs 22,98,972 as capital gains.
SIP Returns (with 12% annual interest rate):
Monthly investment: Rs 7,083
Total investment (15 years): Rs 12,74,940
Estimated returns: Rs 22,98,972
Total value: Rs 35,73,912
PPF Investment Calculation: How Much Will Your Corpus Grow in 15 Years with Rs 95,000 Annual Investment?
If you invest Rs 85,000 per year in a PPF, your total investment over 15 years will also amount to Rs 12,75,000. However, with an annualised return of 7.1 per cent, the interest earned would be Rs 10,30,319. With this, the final corpus would be around Rs 23,05,319 (principal + interest).
PPF Returns (with 7.1% annual interest rate):
Annual Investment: Rs 85,000
Total Investment (15 years): Rs 12,75,000
Estimated Returns: Rs 10,30,319
Total Corpus: Rs 23,05,319
SIP Investment Summary -
PPF Investment Summary -
(Disclaimer: Our calculations are projections and not investment advice. Do your due diligence or consult an expert for financial planning)
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