PPF calculator: ₹12,500 monthly savings can become ₹2.27 crore. Details here | Mint
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Business News/ Money / Personal Finance/  PPF calculator: 12,500 monthly savings can become 2.27 crore. Details here
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PPF calculator: ₹12,500 monthly savings can become ₹2.27 crore. Details here

PPF calculator: Public Provident Fund rules allow investors to invest beyond 15-year maturity period

PPF calculator: To accumulate ₹2.27 crore in one's PPF account, the account holder needs to exhaust one's ₹1.50 lakh limit in one financial year (Shutterstock)Premium
PPF calculator: To accumulate 2.27 crore in one's PPF account, the account holder needs to exhaust one's 1.50 lakh limit in one financial year (Shutterstock)

PPF calculator: Public Provident Fund (PPF) is a government-backed small saving schemes that aims to provide assured return to its investors at the time of maturity. A PPF account holder is eligible to claim income tax exemption under section 80C of the income tax act. However, the exemption limit is capped at 1.50 lakh in single financial year. it is one of those rare risk-free investment option that gives higher return to investors.

PPF interest rate

Currently, PPF interest rate being given to a PPF account holder is 7.10 per cent. Though, PPF interest rate is subject to change on quarterly basis, bit based on the past experience, if we assume this PPF return for next 35 years, if an investor invests 12,500 per month in one's PPF account, one would get a maturity amount of around 2.27 crore.

Speaking on benefits of a PPF account, Jitendra Solanki — a SEBI registered tax and investment expert said, "Up to 1.5 lakh investment is exempted under Section 80C of the Income Tax Act. So, one can avail income tax exemption on up to 1.5 lakh per annum." However, Solanki said that the PPF account maturity period is 15 years and one needs to submit Form 16-H to extend one's PPF account. "PPF account can be extended in a block of 5 years and for that one will have to submit Form 16-H in 15th year of PPF account opening. Similarly, if an investor decided to remain invested in PPF for the next five years, he or she will have to submit Form 16-H in the 20th year of account opening," he added.

So, if an investor decides to invest in PPF account for 35 years, he or she will have to submit For 16-H in 15th, 20th, 25th and 30th year of PPF account opening.

So, assuming 7.10 per cent PPF interest rate for next 35 years, if an investor invests 12,500 per month or 1.50 lakh in one year, one would get a maturity amount of 2,26,97,857 or around 2.27 crore.

Courtesy: PPF calculator Groww
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Courtesy: PPF calculator Groww

According to PPF calculator, an investor would be investing 52,50,000 in its PPF account whereas PPF interest earned in this period would be around 1,74,47,857.

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ABOUT THE AUTHOR
Asit Manohar
Chief Content Producer at Live Mint Digital Team
Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Check all the latest action on Budget 2024 here. Download The Mint News App to get Daily Market Updates.
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Published: 19 Nov 2022, 10:17 AM IST
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