Currently, interest is being received on Post Office Public Provident Fund Scheme i.e. PPF at the rate of 7.10 percent. You can start investing in PPF with a minimum of Rs 500 in a financial year.
In today’s era, most of the people are investing in mutual funds or shares. However, still many people in rural India invest in post office schemes. The reason for this is that there is no risk in the post office scheme. Apart from this, the returns in the investment scheme of post office are also quite good. This is the reason why despite investment options like mutual funds and shares, common people trust the post office schemes the most. Today we will tell you how you can become a millionaire by investing in Post Office PPF.
Public Provident Fund Scheme
Currently, interest is available on Post Office Public Provident Fund Scheme i.e. PPF at the rate of 7.10 percent. You can start investing in PPF with a minimum of Rs 500 in a financial year. You can deposit any maximum amount in it. But you will get exemption only up to a maximum of Rs 1.5 lakh under Section 80C of Income Tax. Interest income on maturity will also be completely tax free. Its maturity period is 15 years and after that it can be extended in blocks of 5 years. Under this scheme, a person can open only one account.
Interest rates are updated every three months
The Finance Ministry does interest rate revision every three months. The interest income is transferred to your account at the end of every financial year. According to the current rate, if you invest Rs 100 daily, then after 15 years when it matures, you will get a lump sum of Rs 9,76,370 which will be completely tax free. Your total deposit during 15 years will be Rs 5,40,000. In this way you will easily become a millionaire.
Get loan
You also get the benefit of loan against PPF. You get loan facility from the next financial year from which you start investing. This facility lasts for a period of five years. You can get a loan up to 25 percent of the amount deposited in your account. Loan can be availed only once in a financial year. The second loan will not be available until the first loan is repaid. If the loan is repaid within three years, the interest rate will be only 1 percent per annum.
Rules for premature withdrawal of money
Talking about withdrawal, withdrawal can be made once in a financial year after the lock-in period of five years. This can be up to 50 percent of the amount deposited in your account. Talking about premature closure, it is allowed if the account holder becomes ill or for higher education of himself or his children. Some charges are deducted for this.
Income Tax Department has started a new facility, crores of people will benefit from this.
