PPF Extension: Earn Rs.24,000 Monthly Without Extra Investment

The Public Provident Fund (PPF) is a popular investment option in India, offering guaranteed returns and tax-free benefits. While its maturity period is 15 years, many investors are unaware of the lucrative opportunities it provides even after maturity. By extending the scheme without further deposits, you can earn a tax-free income of Rs.24,000 per month.

Here’s how you can benefit from the extension rules of the PPF scheme.

PPF Scheme Highlights

1. Interest Rate: 7.1% annually (as of now).
2. Maturity Period: 15 years.
3. Annual Deposit Limit: Rs.500 (minimum) to Rs.1.5 lakh (maximum).
4. Tax Benefits: Falls under the EEE (Exempt-Exempt-Exempt) category, offering tax exemption on deposits, interest, and maturity amount.

How PPF Extension Works

When your PPF account matures after 15 years, you have two options:

1. Extend with Fresh Contributions: Continue depositing up to Rs.1.5 lakh annually to grow your corpus further.
2. Extend Without Contributions: Let the balance stay and earn interest at the prevailing rate (currently 7.1%).

You can extend your PPF account in blocks of 5 years as many times as you wish.

Earn Rs.24,000 Monthly Without Extra Investment

Let’s consider this example:

• Initial Contribution (15 Years): Rs.1.5 lakh annually.
• Total Corpus After Maturity: Rs.40,68,209 (at 7.1% annual interest).

If you extend your account without any new contributions:

• Annual Interest Earned: Rs.2,88,843.
• Monthly Income: Rs.2,88,843 ÷ 12 = Rs.24,000.

This interest is tax-free and can be withdrawn yearly or as per your preference.

Why Choose PPF Extension?

1. Steady Tax-Free Income: You can earn a fixed, risk-free amount monthly.
2. No Additional Contributions Required: Enjoy benefits on your existing savings without further deposits.
3. Flexible Withdrawal Rules: Withdraw the interest or keep it reinvested for more compounding benefits.
4. Ideal for Retirement Planning: A great way to ensure a consistent post-retirement income.

Benefits of PPF

1. Risk-Free Investment: Backed by the Government of India.
2. Tax-Free Returns: Entire corpus and interest remain exempt under Section 80C.
3. Inflation-Adjusted Returns: Though fixed, the returns are competitive for long-term goals.
4. Open for All: Available to individuals, including minors (through guardians).

Stable Interest Rates

PPF has offered stability in interest rates over the years. While the rate has been steady at 7.1% since April 2020, the scheme remains attractive due to its tax benefits and guaranteed returns.

Who Should Opt for PPF Extension?

• Retirees: Looking for a regular income without taking risks.
• Long-Term Investors: Seeking to maximize tax-free returns.
• Parents: Planning for their child’s higher education or future expenses.

Important Rules for Deposits

1. Maximum annual deposit: Rs.1.5 lakh.
2. Minimum deposit: Rs.500 per year to keep the account active.
3. Account can be extended in 5-year blocks post maturity.

Why PPF Stands Out

PPF’s EEE (Exempt-Exempt-Exempt) status ensures unmatched tax savings. It’s an ideal choice for those who prefer safe and consistent growth of their savings without worrying about market risks.

By strategically extending the account after maturity, you can secure a reliable, tax-free monthly income, making it a perfect choice for long-term financial stability.