How to become a millionaire, crorepati kaise bane | Crorepati Tips : How much to invest in PPF every month? become crorepati, how much to invest in PPF every month? become a millionaire

How to become a millionaire, crorepati kaise bane | Crorepati Tips : How much to invest in PPF every month? become crorepati, how much to invest in PPF every month? become a millionaire

How much to invest in PPF every month?  become crorepati

Investing in PPF can make you a millionaire (photo – istock)&nbsp

Headlines

  • The tenure of PPF account is 15 years.
  • The current interest rate on investment in PPF is 7.1% per annum.
  • Follow the rules mentioned below to get Rs 1 crore from PPF.

Public Provident Fund ie PPF is a popular small savings scheme. This savings scheme is government backed. This scheme is extremely popular among investors looking to invest for long term goals like retirement savings. PPF offers moderate returns and is loaded with tax benefits, tax exemptions and protection of capital. The interest earned as well as the returns are not taxable under the Income Tax Act.

The interest rate offered on PPF is higher as compared to most other investment products of the same tenure which give guaranteed returns. Investment in PPF can be done in lump sum or in maximum 12 instalments. The minimum investment amount for each financial year is Rs 500 and the maximum is Rs 1.5 lakh. The current interest rate is 7.1% per annum and the tenure of the PPF account is 15 years.

If invested properly and consistently in PPF, one can accumulate an amount of 1 crore or more by the time of redemption. An investor only needs to extend his PPF account after the maturity period of 15 years and continue to invest continuously to reach the target of Rs 1 crore.

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ppf calculator

To deposit Rs 1 crore from PPF, investors need to be patient and invest regularly for 25 years at the current interest rate of 7.1%. Suppose a person invests Rs 1.5 lakh annually in PPF account at the rate of 7.1%, then it will take him 25 years to become a millionaire. This is because periodic investments in PPF with compound interest for a longer period can do the trick.

The longer the money stays invested, the more it becomes. If an individual starts investing Rs 12,500 per month (the maximum monthly investment that can be made in PPF) or Rs 1.5 lakh per annum and continues with the PPF account for 15 years, then they can earn more than Rs 40.6 lakh at the time of maturity will earn, assuming that the interest remains 7.1% during the investment period.

If the account is extended for a further period of 5 years, then for 20 years (first extension) by investing Rs 1.5 lakh per annum at the rate of 7.1%, the balance in the PPF account will be around Rs 66.6 lakh. If the investor continues to invest Rs 1.5 lakh per annum once again for a period of 5 years, then after 25 years, the PPF account balance will exceed Rs 1 crore, assuming Given that the interest remains constant at 7.1% for the entire investment tenure.

PPF Account Extension Rules

The maturity period of a PPF account is 15 years, but in the 15th year of account opening, you can extend your PPF account by selecting the investment option with interest and submitting the PPF extension form. PPF account can be extended multiple times in a block of 5 years.

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PPF Tax Benefits

The PPF account falls under the exempt-exempt-exempt (EEE) category, where investments up to Rs 1.5 lakh per annum are exempt from income tax. Apart from this, PPF interest rate and PPF maturity amount are also exempted from any income tax.

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