What is the Public Provident Fund (PPF)?
The Public Provident Fund (PPF) is a long-term, government-backed savings scheme in India offering incredible EEE (Exempt-Exempt-Exempt) tax benefits. Your investment, the interest earned, and the final maturity amount are all 100% tax-free.
PPF Rules & Interest Calculation
PPF has a mandatory lock-in period of 15 years, which can be extended in blocks of 5 years. A crucial rule to maximize PPF returns is to invest before the 5th of every month. Why? Because interest is calculated on the lowest balance between the 5th and the end of the month. Our PPF Calculator accurately models this annual compounding structure.
Why PPF is the Ultimate Safe Investment
With an interest rate typically hovering around 7.1% p.a., PPF outshines FDs simply because its returns are completely tax-free. For someone in the 30% tax bracket, a 7.1% tax-free return is equivalent to a taxable FD offering over 10%!