In a PPF, interest is earned on the principal amount deposited, and it is paid out along with the principal amount at maturity. PPF calculators allow you to calculate interest rates offered on principal amounts. A PPF calculator saves a significant amount of time and effort when compared to manually calculating interest on the principal amount.
What is a PPF calculator?
The PPF calculator calculates the interest a PPF account holder earns on a deposited amount using an online tool. The calculation of PPF interest is simple and error-free. PPF rules, guidelines, interest rates, maturity, tenure, withdrawal limits & rules, etc., are all set by the government, so a bank-specific PPF calculator is not needed.
Why is PPF so popular?
Public Provident Funds (PPFs) have traditionally been one of the most popular financial instruments for saving long-term, primarily because of their tax benefits and safety. IDFC First Bank believes that PPFs are among the best savings schemes in India, as they are safe investments that will benefit you in the long run. The money invested in a PPF account is locked in for 15 years. You can only access a portion of your account’s funds after 6 years. The PPF is a long-term investment. Once the 15-year period has passed, you can extend the duration for another five years. You earn compound interest on your cumulative profits.”
Interest rate for PPF
According to the Ministry of Finance, interest rates will be set quarterly and credited to each PPF account at the end of each financial year. The interest rate for the quarter ending June 30, 2022 is 7.1 percent compounded annually.
What is the interest rate on a PPF?
The interest is calculated based on the lowest balance in the account between the fifth and last day of the month for the calendar month. At the end of each financial year, interest will be credited to the account regardless of where it stands at the end of the fiscal year.
How much can I invest in a PPF?
The maximum deposit in a financial year is Rs 1.50 lakh, with a minimum of Rs 500 and a maximum of Rs 1.50 lakh. In a fiscal year, individuals can deposit anywhere from Rs 50 to Rs 1.50 lakh in any number of installments. The maximum limit includes deposits made in his or her own account as well as those made on behalf of minors.
Investing in PPF has tax benefits
The fact that PPF is tax-exempt (exempt-exempt-exempt) is one of the reasons it is so popular. As a result of this, interest earned and proceeds received at maturity are all tax-exempt at the time of investment. PPF investments can also be deducted under Section 80C.
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