We are telling you about the PPF scheme which is very economical. Through this you will easily add big amount. Under the PPF scheme, there is a guarantee of safety on your investment. Income tax (Non-Taxable Return) is not charged on the interest received under the scheme.
New Delhi. If you think that by saving 50 or 100 rupees, no big savings can be made, then this news is for you. It is wrong to think that it is necessary to have a large amount for good savings. You can make a big corpus even by making small savings. To earn more income by investing less, it is necessary to invest money in the right place. We are telling you about one such scheme which is very economical and through this you will easily add big amount. Public Provident Fund Account (PPF) is an alternative to such small savings scheme.
Benefits of PPF
Under the PPF scheme, there is a guarantee of safety on your investment. Income tax is not applicable on the interest earned under the scheme. It also has the facility of nominee. This account is opened at the post office and selected branches of banks for a period of 15 years, which can be extended up to 15 years by 5-5 years. At present, interest is being received on PPF account at the rate of 7.10 percent.
This account can be opened with just Rs 500
To open a PPF account, you only need Rs 500. It is clear that it is necessary to invest at least 500 rupees in a financial year in this. A maximum of Rs 1.50 lakh can be invested in this in a year. The government fixes the interest rates for this account from time to time.
This is how a fund of 32 lakhs will be made
Under this scheme, if you think of investing by saving only Rs 200 a day, then it will become Rs 6000 a month. In this way your annual investment will be Rs 72,000. If you do this for 15 years, then your total investment will be Rs 10,80,000.
Interest is being paid in PPF in terms of compound interest of 7.1% per annum. If interest is received at the same rate for 20 years, then the total return on investment will be Rs 14.40 lakh. You will get additional benefit in the form of interest of Rs 17.55 lakh on your total investment. If you understand in simple words, in 20 years, you will have a total fund of 32 lakh rupees.
Compound interest formula
A: Total Amount Principal
r: rate of interest
n: how many times compounding in a year
nt: total time