Public Provident Fund (PPF) is considered a safe investment option backed by the Government of India, which provides guaranteed returns. But do you know that after investing in PPF for 15 years, you can earn tax free income of Rs 1 lakh every month? If not, let us tell you how?
You can invest a minimum of Rs 500 and a maximum of Rs 1.5 lakh every year in a PPF account. You can deposit this investment in a lump sum amount or in 12 monthly installments, whichever is convenient for you.
If you invest an amount of Rs 1.5 lakh every year for 15 years, your account will mature. After this, you can extend it for additional extension of 5-5 years and continue the investment process.
In 15 years, your investment amount will be around Rs 22.5 lakh, with interest on the total maturity amount reaching Rs 40.68 lakh. In 20 and 30 years, this amount can grow to Rs 66.58 lakh and Rs 1.54 crore respectively.
With continued investment and compounding of interest, your total deposit amount can reach up to Rs 1.95 crore in about 33 years, which will include interest of about Rs 1.45 crore which is completely tax-free.
After 33 years, your total amount will earn an interest of around Rs 16.24 lakh annually, which will give you a tax-free income of around Rs 1,15,363 on a monthly basis.
