PPF is a safe investment option. You can secure your child’s future by opening a PPF account in your child’s name. However, it is important to know some rules for this.
Public Provident Fund (PPF) is the most popular investment option. It is risk free as well as gives good returns. You can secure your child’s future by opening a PPF account in your child’s name. We will tell you what terms and conditions apply for opening a PPF account for a child.
A person can open a PPF account in his name.
- A person can open another PPF account in the name of his minor child in addition to his PPF account.
- For parents who have two children, a minor child’s PPF account can be opened by the mother and the second child’s PPF account can be opened by the father.
- Both parents cannot open a minor PPF account in the name of the same child.
- How much money can I deposit ?
- For a minor PPF account, a deposit limit of at least 500 and maximum of Rs 1.5 lakh is applicable in a financial year.
- If the parents also have their own PPF account, then the maximum deposit limit, including both their own account and the minor’s PPF account, will be Rs 1.5 lakh per annum.
- Loan and Partial Withdrawal
- Minor PPF accounts also provide benefits such as loans and partial withdrawals.
- However, to make a loan or partial withdrawal on a minor account, the guardian will have to declare that the money is being withdrawn only for the minor.
- When the child is 18 years old
- When the child becomes 18 years old, an application will have to be made to the status minor of his account.
- Adults can handle their own account by themselves.
- A PPF account can be opened in a post office or bank in your own name and through someone else on behalf of a minor. However, as per the rules, a PPF account cannot be opened in the name of a Hindu Undivided Family (HUF).