PPF Calculation: How much will you earn in 15 years by investing Rs 3,000, Rs 7,000, and Rs 10,000 monthly in Post Office Public Provident Fund?
The Post Office offers several investment schemes, among which one of the most popular and low-risk investments is the Public Provident Fund (PPF). It offers tax exemption under Section 80C of the Income Tax Act on deposits up to Rs 1.5 lakh per financial year. It has a lock-in period of 15 years, which can be extended in 5-year blocks.
Public Provident Fund (PPF) is popular among individuals due to some compelling factors. The first one is the EEE criteria, which means that deposits, interest, and withdrawals are all tax-exempt in PPF. The second one is that it has a lock-in period of 15 years, but the depositor can also extend the account for a further block of 5 years, and so on. There are more interesting features of PPF that one can avail. To learn more, go through the gallery and find out how much you will earn in 15 years by investing Rs 3,000, Rs 7,000, and Rs 10,000 monthly in the Post Office Public Provident Fund.
Photos source: Pixabay/Representational
(Disclaimer: Our calculations are projections and not investment advice. Do your due diligence or consult an expert for financial planning)
PPF account: Post Office vs Bank
When choosing where to open a PPF account, you can opt for either a bank or a post office, as both offer the same rules and benefits.
PPF account eligibility
1. Resident Indian Adult: A single adult who is a resident of India can open a PPF account.
2. Guardian for Minor/Person: A guardian can open a PPF account on behalf of a minor or a person.
Only one PPF account can be opened across the country, either in a post office or a bank.
PPF deposit rules: Important things to know
1. Minimum and Maximum Deposit: The minimum deposit required in a financial year is Rs 500, while the maximum deposit allowed is Rs 1.50 lakh.
2. Combined Deposit Limit: The maximum limit of Rs 1.50 lakh applies to the combined deposits made in: Your own PPF account or a PPF account opened on behalf of a minor.
PPF account maturity
The account matures after 15 financial years, excluding the financial year of account opening.
What to do after PPF maturity
You can take the maturity payment by submitting the account closure form along with the passbook at the concerned Post Office.
The depositor can retain the maturity value in the account without making further deposits, and the applicable PPF interest rate will still be earned; the payment can be taken at any time, or one withdrawal can be made per financial year.
The depositor can also extend the account for a further block of 5 years, and so on, within one year of maturity, by submitting the prescribed extension form at the concerned Post Office.
PPF withdrawal rules
Here are the rules regarding withdrawals from a PPF account:
You can make one withdrawal per financial year, but only after five years from the date of account opening, excluding the year of account opening.
The amount of withdrawal allowed is up to 50 per cent of the balance credited to the account at the end of the fourth preceding year or the end of the preceding year, whichever is lower.
Post office PPF calculation conditions
Investment amount: Rs 3,000, Rs 7,000, Rs 10,000
Annualised rate of return: 7.1 per cent
Investment period: 15 years
What will be PPF corpus after 15 years with an investment of Rs 3,000 per month?
Annual investment: Rs 36,000 (3,000x12)
Your total investment amount over 15 years will be Rs 5,40,000. The estimated interest earned during this period will be Rs 4,36,370 and the estimated maturity amount will be Rs 9,76,370.
What will be PPF corpus after 15 years with an investment of Rs 8,000 per month?
Annual investment: Rs 84,000 (7,000x12)
Your total investment amount over 15 years will be Rs 12,60,000. The estimated interest earned during this period will be Rs 10,18,197 and the estimated maturity amount will be Rs 22,78,197.
What will be PPF corpus after 15 years with an investment of Rs 10,000 per month?
Annual investment: Rs 1,20,000 (10,000x12)
Your total investment amount over 15 years will be Rs 18,00,000. The estimated interest earned during this period will be Rs 14,54,567 and the estimated maturity amount will be Rs 32,54,567.