# PPF Calculator

## PPF Calculator

Use the Public Provident Fund Calculator and speculate the final amount you will receive at the time of your maturity including the interest amount.
Public Provident Fund (PPF) was introduced in India in 1968, and it mobilizes small savings in the form of investment. It remains a favorite savings avenue for many investors as the returns are tax-free.
This investment is also called a savings-cum-tax savings investment, as it enables one to build a retirement corpus. And you don’t even have to worry about taxes while saving on PPF. So anyone looking for a safe investment option should consider opening a PPF account.

## Benefits of PPF

1. PPF investment risk is low because the government backs it.

2. One can open a PPF account at nationalized banks, public banks, post offices and selective private banks. So there’s a wide option for you.

3. Although the lock-in period is 15 years for a PPF, you get the option to either withdraw some money or take loans after seven years. The returns from a PPF are more attractive compared to bank FDs.

4. PPF deposits come under the EEE (exempt-exempt-exempt) category. It means your principal investment, the interest you earn, and the proceeds received at maturity are all tax-exempt. Also, the deposit amount in a spouse’s or child’s PPF account is also tax-exempt.

### How is PPF interest calculated?

The interest in a PPF account is compounded annually, and the formula for this –

F = P [({(1+i) ^n}-1)/i]

Here,

• F = Maturity proceeds of the PPF
• P = Annual installments
• n = Number of years
• i = Rate of interest/100

For example, if you make an annual investment of Rs. 1 Lakh towards your PPF at 7.1%, your maturity proceeds would be Rs. 31, 17,276.

### What is a PPF calculator?

Handling calculations may be a piece of cake for some of us. And in case you are planning to invest in PPF and are trying to figure out what to invest or how much returns you may get, use the PPF calculator.

Once you decide the amount to invest regularly, the calculator considers the tenure of 15 years and the prevailing interest rate for the computation of PPF returns.

### How to Use the PPF Calculator?

PPF calculator is an easy-to-use investment calculator. This online tool uses a self-explanatory and user-friendly interface. If you are new and don’t know how to use online calculators, here’s a simple step-by-step procedure:

Step 1: You will find a drop-down menu under the ‘Frequency of Investment’ field. Select monthly, quarterly, half-yearly, and yearly from the drop-down menu. Choose an option from the drop-down menu on how often you want to deposit into the PPF account in a financial year.

Step 2: You’ll see the label ‘Yearly Deposit Amount’. Enter the amount you plan to deposit in the PPF account over a financial year. The maximum amount to deposit in the PPF account is Rs. 1.5 Lakh in a financial year.

Step 3: For your information, the current interest rate is provided by default.

Step 4: Click on the blue circle you’ll see on the screen and drag the pointer to the right based on the years you wish to stay invested. The default choice is 15 years, as this is the minimum investment period. At the right end of the slide, the numeric value of your selection will be displayed on the screen.

Step 5: PPF calculator automatically calculates the maturity value based on the values you have provided and the interest rate applicable in the present day.

PPF calculator helps estimate the returns, and it is a big help when you are planning your investments because:

• The calculator resolves your many questions about how the account works.
• You can clearly see how much returns you can expect on investing a certain amount.
• You can use the calculator repeatedly until you get a balance between the investment amount and the desired returns.
• Since this calculator is automated, manual calculations can be skipped, and there are zero chances of errors.
• It is advised to use the calculator at the tax-planning stage. This way, you can plan your investments better.
• There’s an option to extend the PPF account, so you can invest above 15 years lock-in period. And knowing the time you have for retirement and how much wealth you can grow helps you get the best returns.

## FAQs

Public Provident Fund Account or PPF Account is like a government-sponsored savings scheme that offers stable and fixed returns for long-term investment. And other than that, you will get opportunities like tax benefits. PPF is a secure investment that comes in use for – children’s higher studies, retirement corpus, vacation, etc.

Benefits of PPF include – fixed returns, tax benefits, withdrawal options and loan facilities.

The interest rate on PPF is announced by the government every quarter and linked to government securities. So it changes accordingly. The interest on the PPF is calculated based on your deposit balance in the PPF account before the 5th of every month. So it is wise to make your deposit before the 5th of every month to get the maximum benefit out of the investment. Any deposit you make after the 5th will not earn interest for that particular month.

The lock-in period is 15 years and can be extended in blocks of five indefinitely. There is the option of partial withdrawal after five years, subject to conditions.

To start investing in PPF, you need to make a minimum investment of Rs 500.

This will depend on your investment amount and the interest rate.

Yes, up to Rs 1.5 Lakh investment in PPF is tax-free, including the interest earned, and the maturity amount is all tax-free.

The return rate of PPF has been linked to government securities and changes accordingly. PPF rates are announced by the government every quarter.

The maturity period is 15 years, and it starts from the end of the financial year following the first investment you’ve made. For instance, you made the first investment in June 2022. Your first full year of an investment would be from April 2023 to March 2024.

The account will become dormant if you miss making your contribution for a year. You can activate the PPF account again by paying a minimum contribution of Rs. 500 and a penalty of Rs. 50 for each year you missed contributing.

Yes, you can invest in PPF online. To invest online, visit the preferred bank website.

No, only one PPF account per subscriber is allowed. But you’re allowed to open a PPF account in your minor child’s name.

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