How To Calculate Return From PPF Calculator?

Learn everything about PPF, its benefits, returns on PPF investments, and how to use the PPF calculator to calculate the estimated returns on your investment

 

PPF (Public provident fund) is considered to be the safest investment option among Indian investors. In India, not every person is employed and even if they are employed, they are not working in a company where more than 20 employees are working. So, these individuals can opt for PPF investment to grow their wealth in the long term.

 

What is PPF?

PPF investment is a savings scheme in India which allows you to save and invest your money for the long term. If you are not working in a company as an employee, then you can opt for opening a PPF account. Any individual can open this account as it is open to every Indian citizen. The current rate of return is 7.1% per annum on PPF investment. You can open a PPF account from a bank or a post office. If you want to open a PPF account online, you can open it from any nationalized or private bank that is providing this facility. The minimum investment you can invest in PPF is Rs. 500 and the maximum investment amount is Rs. 1.5 lakhs. You can invest monthly/quarterly or a lump sum amount annually. However, you should decide the amount which you want to invest and in what frequency beforehand.

 

How to calculate returns from PPF calculator?

Open the PPF calculator online as It is easily available on the internet.Enter the amount you want to invest every year, the time period of your investment, and the current rate of interest.Then the PPF calculator will calculate the total maturity value along with the total interest and invested amount.

 

PPF calculator will help you to find the estimated returns on your investment. One thing you need to keep in mind is that the interest rate can be changed by the government of India.

Things you should keep in mind while investing in PPF

You should keep in mind that the PPF investment has a lock-in period of 15 years. Hence, you cannot withdraw the amount invested before 15 years. After 15 years, you have the option to extend the period of your investment by 5 every year.

 

PPF investments are suitable for those who want to invest for the long term and fulfill their financial objectives. For example, if you want to save for your children's marriage or education or buy a house, or your retirement then you can save and invest your money in PPF.

 

In case you have a financial emergency and need money urgently, You can avail of loan benefits in the 3rd and 6th year of your PPF investment against your PPF. The interest rate on the loan will be the interest of PPF plus 2%. Let's say in your 3rd or 6th year you have Rs. 2 lakhs in your PPF account, then you can take those Rs. 2 lakhs on loan. However, you have to pay interest of 7.1% plus 2%, which is 9.1%.

 

You can withdraw your PPF investment partially from the 7th year to the 15th year of your PPF investments. However, you need to keep in mind that you can not withdraw the whole amount. The whole amount can be withdrawn at the end of the 15th year.

 

To conclude, PPF investment is a great investment option to grow your wealth in the long run. However, make sure that the PPF investment matches your risk profile, expected returns, and time horizon of the investment.