The Public Provident Fund (PPF) is a government-backed small savings program that aims to provide investors with a guaranteed return upon maturity. PPF account holders are eligible to seek an income tax exemption under Section 80C of the Income Tax Act. Nevertheless, the exemption amount is only permitted to exceed 1.50 lakh in a single fiscal year. It's one of the few low-risk investment choices with a higher rate of return for investors.
The unique aspect is that you can become a millionaire in a matter of years if you save and invest just Rs 416 per day in this government initiative. Let's examine how it was calculated.
Currently, a PPF account holder receives interest at a rate of 7.1%. The interest rate of PPF has remained at 7.1% since April 2020. Although the PPF interest rate is subject to vary every quarter, based on past performance, if we anticipate this PPF return for the following 35 years, an investor would get a maturity amount of almost 2.27 crore if they invested 12,500 per month in their PPF account.
Now let's talk about how you can fulfill your dream of becoming a crorepati by saving just Rs 416 per day, so let us tell you that its calculation is very simple. If you save this much amount daily, then every month Rs 12,500 will be collected and annually you will have Rs 1.5 lakh.
If you invest this much amount in PPF Scheme up to 10 years and extend it for five years each, then your investment will become more than Rs 1 crore in 25 years. Based on 7.1 percent interest, then after 25 years at the time of maturity, you will have Rs 1,03,08,015.
