If you are employed, money is deducted from your salary every month in EPF i.e. Employees Provident Fund. This small contribution creates a huge fund in the long run. If you deposit just Rs 5000 every month in EPF and your salary increases by 10% every year, then this amount can reach up to Rs 3.5 crore by the time of retirement
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If you are employed, then every month money is deducted from your salary for EPF i.e. Employees Provident Fund.
If you work, every month money is deducted from your salary in EPF i.e. Employees Provident Fund.
Do you know, by putting just Rs 5000 per month in EPF, you can create a retirement fund of Rs 3.5 crore?
EPF i.e. Employees Provident Fund is a government retirement scheme, which is managed by EPFO.
In this, the employee deposits 12% of his basic salary and the employer contributes 3.67%.
8.33% goes directly to pension (EPS).
The government gives fixed interest on it every year. The current interest rate is 8.25%. That is, the money keeps increasing automatically.
Example: If your salary is Rs 64,000, then the basic will be Rs 31,900.
Employee contribution: Rs 3,828
Employer contribution: Rs 1,172
Total EPF = approx Rs 5,000 per month
If the salary increases by 10% every year, the amount going into EPF will also increase.
Along with this, 8.25% interest will keep getting added continuously.
If a person starts working at the age of 25 and pays EPF continuously for 58 years…
Total time = 33 years
Total investment in EPF during this period = Rs 1.33 crore
But with interest and growth, the fund till retirement will be = around Rs 3.5 crore
EPF not only provides savings but also the benefits of pension (EPS) and insurance. That is why it is considered the safest and most reliable retirement plan.
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