PPF Account: If the account holder dies before the maturity of the PPF account, then his nominee can withdraw the money. In such a situation, the condition of completion of 5 years of the account is also rejected.
Public Provident Fund: Public Provident Fund (PPF) is a great saving instrument. Long term investment helps in creating a huge fund in it. Especially PPF is most popular as a traditional investment. PPF investment with good interest, interest and maturity amount are completely tax free. The maturity period is of 15 years. But, exemption is given for withdrawal with certain conditions. If an investor wants to close the account, special conditions have been given for that. PPF account can be closed even before time.
When does PPF account close?
The PPF account holder can withdraw money before maturity in situations like saving himself, spouse and children from life-threatening diseases. At the same time, in the case of own education or higher education of children, money can be withdrawn from the PPF account before maturity. The PPF account can be closed prematurely in case the account holder becomes an NRI. PPF account can be closed exactly after completion of 5 years from the opening date. However, during this period 1% interest will be deducted from the date of opening of the account.
What happens to PPF account on death?
If the account holder dies before the maturity of the PPF account, then his nominee can withdraw the money. In such a situation, the condition of completion of 5 years of the account is also rejected. After the death of the account holder, his Public Provident Fund account is closed. The money is given to the nominee or legal heir. However, carry forward of the same account is not allowed.
Tremendous benefits of compounding interest
Any Indian citizen can open PPF account. For this he has to put proof. The account can also be opened in the name of a minor. The interest rate on PPF is decided by the government and due to being a government scheme, government guarantee is also available. Interest is revised on a quarterly basis. At present, 7.1 percent interest is being received on PPF. However, the interest is calculated annually. PPF can be started with an investment of Rs 500 and a maximum of Rs 1.5 lakh is allowed in a financial year.
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