Have you ever heard about the PPF investment scheme? PPF is an online investment scheme that aims to allow salaried individuals who do not get coverage from EPF to save money or plan their retirement.
It is easy for self-salaried individuals to open their PPF account for long-term savings. PPF is one of the most famous investment schemes available currently in the market. The best thing is that the PPF offers people wealth accumulation and tax benefits.
Along with it, PPF also provides the facilities to repay the partial loan or make a partial withdrawal. Keep reading all the article’s facts before deciding to make the PPF investment scheme.
How the date of maturity is calculated
PPF investment schemes come with a solid lock-in period of 15 years. But the date of maturity is not calculated from the account opening date. It is calculated according to the PPF scheme rules.
According to the public provident fund’s scheme rules, the maturity date has come into account from the end of the financial year you invest in the scheme.
What is partial liquidity?
The PPF scheme comes with a lock-in period of 15 years. This scheme provides the benefits of partial liquidity and partial withdrawal in terms of loans.
The loans and withdrawals are governed by the conditions based on the balance remaining in your PPF account and the completion of tenure.
How the interest on your PPF account is calculated
The minimum balance is taken from the fifth of every month to the end of that month to calculate the interest rate. You can directly use the PPF calculator to calculate the interest on the PPF account.
- So, if you decide to make monthly contributions, you should start on the fifth of every month.
- On the other hand, if you want to make yearly contributions, you should start your contributions before April 5th of every financial year.
- There is a good fact behind it. The interest is credited into your PPF account at the end of the march of every financial year but calculated every month.
- So, it becomes easy for you to remember the minimum account balance for April 5th. However, if your contributions pass over the maximum fixed limit, then you do not earn the interest on it.
How much can you invest in the PPF scheme?
The minimum contribution you can make to your PPF account is INR 500.
- The maximum contribution you can make to your PPF account is INR 1.5 lakhs.
- This contribution limit is valid for all investments made under your name or minors under the name.
- You also get the choice of contributing the amount in lump sum to the PPF account or paying in monthly installments.
Remember that you cannot exceed the limit of 12 installments per financial year.
Conclusion
There are many benefits to opening a PPF account. The best thing is that you can easily transfer money from one bank to another with the help of a PPF account.
