The most important thing about investments is that you have to give it time. It does not matter whether your contributions in this investment exercise are small. The idea is to start as early as possible and then make sure that you continue investing month after month without a break. This is the PPF trick that will work wonders for anyone and make them a PPF crorepati! There is no rocket science involved here as our PPF calculator will make clear. Just two things are required to back your dedication to creating wealth for yourself and your family. One is the continuation of the high PPF interest rate of 7.1% and the second is not ever withdrawing any money from your PPF account. In case you follow these PPF tips, you are well on the way to becoming a crorepati.
What is Public Provident Fund?
The Public Provident Fund is an investment scheme for citizens backed by the government in which they invest regularly and earn an interest rate that is quite high. The interest rate is fixed by the government and fluctuates often. Notably, it is just at 7.1% now, although earlier it used to be much higher. PPF interest rate in the year 2000 was as high as 12%! Yes, you read that right! Now, the government has reduced it immensely. The same has happened to the Employees’ Provident Fund Organisation (EPFO) interest rate, but it is still higher at 8.25%. Exactly how the PPF vs EPF permutations and combinations work out is unclear.
How to become a PPF crorepati
Now, even with this PPF interest rate, an investor can become a crorepati, but his investment journey has been made longer and more difficult. Let us assume that we have a conscientious 20-year-old saver who wants to be a PPF crorepati in order to have a big sum of money for his family on retirement. Let us say, he invests Rs 10000 monthly in his PPF account at that age. And he continues doing so for as long as 40 years. Since he started his PPF journey at 20, he will be 60 in that time and ripe for retirement, if he so wishes.
According toe the PPF calculator, these figures will create a PPF crorepati. The PPF amount after this period that he gets will be an awesome Rs 2,63,27,728. Yes, he will be anointed a PPF crorepati for sure.
And just imagine, if instead of Rs 10000 per month that he was investing, he had invested Rs 12500 – the maximum allowed in a fiscal! If that were the case, this man would have earned a gigantic sum indeed – Rs 3,29,09,660! A triple crorepati!
Do remember that after the initial lockin period of 15 years, the PPF account has to be extended in batches of 5 years. It can be done indefinitely.
Note: The sums mentioned hare are estimates and the actual amounts would be available in the PPF passbook.
If you want to become a PPF crorepati, then this PPF trick will turn your Rs 10000 into Rs 2 crore. And you can gun for far more. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
