Public Provident Fund money making tips: How to become a Crorepati by investing in PPF

A minimum of Rs 500 and a maximum of Rs 1.5 lakh per annum can be deposited every year in a Public Provident Fund account at present.

New Delhi: The key to reaping good return from your investment lies in starting saving from an early stage and continue doing it in a disciplined manner. The Public Provident Fund (PPF) Scheme, is one such investment option that gives you long term benefits.

Public Provident Fund currently offers an interest rate of 7.1 percent. A minimum of Rs 500 and a maximum of Rs 1.5 lakh per annum can be deposited every year in a PPF account at present.  Deposits can be done maximum in 12 transactions.

If you invest the maximum allowed sum in Public Provident Fund , it will make you a crorepati  in the long term. Here is an assumptive calculation on how you can become a crorepati by investing Rs 1.5 lakh per year in PPF.

PPF scheme was introduced by the National Savings Organization in 1968 was aimed at making small savings a lucrative investment option.  A PPF account matures in 15 years, after which you can either withdraw all your money or extend the PPF account for a block of 5 years each.

Check out the following calculation

Assuming you started investing in PPF at the age of 20. At 7.1 percent interest rate, if you continue to invest in PPF for 30 years (15 years of normal lock in period and extension of 4 consecutive blocks), you will be investing a total amount of Rs 45 lakh. At maturity (after 30 years), you will get Rs 1,54,50,911. The total wealth that you have gained thus is Rs 1,09,50,911.

(Disclaimer: This is an assumptive calculation and in no manner intended to be of any financial advice. For further clarity you can check with your portfolio manager)