The Public Provident Fund (PPF) has been one of the popular investment options for investors looking for safety of their money, tax benefits and a decent return. Currently, the PPF offers 7.1% interest rate per annum. Unlike market-linked products such as mutual funds or stocks, which offer higher returns but come with higher risk, PPF gives investors a guaranteed return with no risk.
Backed by the government, PPF brings safety and offers the added advantage of tax-free interest and maturity proceeds under Section 80C of the Income Tax Act. PPF is particularly appealing for conservative investors seeking long-term growth with guaranteed returns, while those willing to expose them to more risks might prefer market-linked investments as they offer higher gains.
As an investor, If you’re looking for a low-risk investment with good returns, PPF can be a great option. PPF is open to any Indian citizen and allows you to invest up to Rs 1.5 lakh per year, with a minimum deposit of Rs 500. The PPF has a 15-year term and offers the benefit of compound interest.
Also read: PPF Calculator: Want a corpus of Rs 1 crore from public provident fund? Know how long it will take
Here’s a breakdown of the returns you can expect from monthly investments in PPF:
PPF corpus with investment of Rs 2000 per month
Annual investment: Rs 24,000
Total investment over 15 Years: Rs 3,60,000
Interest earned: Rs 2,90,913
Maturity amount: Rs 6,50,913
PPF corpus with investment of Rs 3000 per month
Annual investment: Rs 36,000
Total investment over 15 Years: Rs 5,40,000
Interest earned: Rs 4,36,370
Maturity amount: Rs 9,76,370
PPF corpus with investment of Rs 4000 per month
Annual investment: Rs 48,000
Total investment over 15 Years: Rs 7,20,000
Interest earned: Rs 5,81,827
Maturity amount: Rs 13,01,827
PPF corpus with investment of Rs 5000 per month
Annual investment: Rs 60,000
Total investment over 15 Years: Rs 9,00,000
Interest earned: Rs 7,27,284
Maturity amount: Rs 16,27,284
These calculations give you an idea of the potential returns on your PPF investment.
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