The government has not changed the interest rate of small savings schemes. This means that in the second quarter of this financial year, the interest of all small savings schemes will remain unchanged. These include PPF, Sukanya Samriddhi Yojana, Kisan Vikas Patra and Post Office Savings Deposit Schemes. The interest rate on PPF will remain 7.1 percent. This is the most popular investment option in Small Savings Scheme.
Deduction benefits on investment of 12,500 every month
Public Provident Fund (PPF) Tax deduction can be claimed on investment in. However, it has to be kept in mind that taxpayers using only Old Regimm of Income Tax can claim this deduction. In a financial year, deduction can be claimed by investing a maximum of Rs 1.5 lakh in PPF. This means that if a person invests Rs 12,500 every month in PPF, then he can claim deduction on his total investment in a financial year.
PPF is an investment scheme with EEE Tax Benefit
An investment of Rs 12,500 every month in PPF is prepared in a fund of Rs 40.6 lakh in 15 years. A major feature of PPF is that this EEE comes in tax-banfit investment options. This means that there is no tax on your contribution amount. The interest amount of your deposit is not taxed and in the end there is no tax on your maturity amount.
There is no fear of drowning money due to government scheme
Such people want fixed returns on investment, PPF is the best option for investment for them. Due to its attractive interest rate, many people involve PPF in retirement planning. Since this small savings scheme receives the support of the government, in which investment is considered safe in them. There is no fear of sinking your hard -earned money in them.
Investment gets matured in 15 years
Financial Advisors say it is prudent to include PPF in retirement planning. The reason for this is that the returns of the equity scheme of mutual funds affect the ups and downs of stock markets. However, your investment in PPF does not affect the stock market ups and downs. Investors only have to keep in mind that PPF money matures in 15 years.