If you start investing Rs 1.5 lakh every year in the Public Provident Fund (PPF) at age 25, you give your money enough time to grow steadily through the power of compounding. With disciplined annual contributions over decades, you may be able to build a tax-efficient corpus without taking high market risks.
But how much can you realistically accumulate by age 40, 50, or 60 if you stay consistent? Here’s a closer look at the potential PPF corpus at different stages of life.
PPF Calculator
PPF deposits currently earn 7.1% per year, compounded annually. The government reviews the PPF rate every quarter. A PPF account has a lock-in period of 15 years, but can be extended in multiple blocks of five years indefinitely after maturity. Investors can invest from Rs 500 to Rs 1.5 lakh in a financial year.
If you start investing Rs 1.5 lakh a year in a PPF account at the age of 25 till 60, you can expect an estimated corpus of Rs 2.26 crore approx. This assumes you constantly invest in the maximum allowed each year at the current tax-free interest rate of 7.1%, extending the account forward in 5-year increments after the initial 15-year maturity. Here’s a breakdown of your guaranteed, no-market-risk wealth at different ages:
At Age 40 (After 15 years)
Total Invested: Rs 22.5 Lakh
Estimated Interest Earned: Rs 18.18 Lakh
Expected Corpus: Rs 40.68 Lakh
At Age 50 (After 25 years)
Total Invested: Rs 37.5 Lakh
Estimated Interest Earned: Rs 65.58 Lakh
Expected Corpus: Rs 1.03 Crore
At Age 60 (After 35 years)
Total Invested: Rs 52.5 Lakh
Estimated Interest Earned: Rs 1.74 Crore
Expected Corpus: Rs 2.26 Crore
| Age | Milestone | Total Invested | Interest Earned | Estimated Corpus |
| 40 | 15 Years (Initial Maturity) | Rs 22,50,000 | Rs 18,18,209 | Rs 40,68,209 |
| 50 | 25 Years (2 Extensions) | Rs 37,50,000 | Rs 65,58,015 | Rs 1,03,08,015 |
| 60 | 35 Years (4 Extensions) | Rs 52,50,000 | Rs 1,74,40,229 | Rs 2,26,90,229 |
Source: SBI Securities
Should you invest in PPF amid the current rate cycle?
With the RBI cutting rates in 2025 and FD rates softening across banks, PPF’s 7.1% now looks more attractive than it did 18 months ago. The government has kept the PPF interest rate unchanged at 7.1% since April 2020. That said, the scheme still offers one of the best risk-free post-tax returns available for conservative investors.
The main reason is taxes. PPF’s tax-free return of 7.1% is equivalent to a return of over 10% pre-tax on a taxable FD for a person in the 30% tax bracket. Most large bank FDs now offer much lower post-tax returns after the recent softening in deposit rates.
The PPF rate has sat at 7.1% since April 2020, and most people don’t realise it’s already above what the government’s own formula requires. The Shyamala Gopinath Committee framework links PPF to 10-year G-Sec yields plus 25 basis points, which currently works out to around 6.57–6.79%. Investors are getting 30–50 basis points more than the formula mandates.
This means the formula-implied PPF rate is broadly close to the current 7.1% level. In fact, at several points over the past year, the prevailing PPF rate has remained slightly higher than the formula would strictly require. That reduces the chances of a major rate hike in the near term.
“For someone in the 30% tax bracket, 7.1% tax-free works out to a pre-tax equivalent of roughly 10.1%, which is more than most bank FDs currently offer after tax. A downward revision is possible, but the government has consistently protected small savings rates,” commented Swati Jain, CEO – Wealth, Arihant Capital Markets.
On a post-tax, risk-adjusted basis, this is the best guaranteed return available right now. For the disciplined investors who can wait for the long lock-in period, PPF continues to be one of the best tax-efficient fixed income options available in India today.
Is PPF good for long-term investing?
PPF is not the highest-returning instrument out there. An equity SIP at 12% would give roughly Rs 63.9 lakh over 15 years against PPF’s Rs 40.60 lakh, and that gap is real. But what equity cannot offer is certainty. PPF has no bad years, no fund manager risk, and no anxiety about a market crash wiping out savings right before retirement.
Its EEE structure, where contributions are deductible under 80C, interest is tax-free, and maturity is fully exempt, is unmatched by any other government-backed instrument in India.
The smartest way to use it is as the debt anchor in a broader portfolio. Put 20–30% into PPF for a guaranteed floor and the rest into equity for growth. The Rs 2.29 crore corpus at 60 isn’t a consolation prize for playing it safe, says Swati Jain. It’s the foundation that makes the rest of the retirement plan actually work.
Disclaimer: The calculations and projections mentioned in this article are illustrative in nature and based on the current PPF interest rate of 7.1% per annum, compounded annually. PPF interest rates are reviewed by the government every quarter and may change in future. Actual returns may therefore vary. The article is meant for informational purposes only and should not be considered financial or investment advice. Investors should evaluate their financial goals, risk profile and consult a qualified financial advisor before making investment decisions.