You need to invest so much in PPF to earn more than Rs 1 Crore

By Anshul STI (Update)


PPF is an investment tool that can help you accumulate more than Rs 1 crore in your account. But it requires proper investment and patience. let’s see how

The Public Provident Fund (PPF) – a retirement-focused investment – helps generate returns above inflation over the long term. Periodic investments in this long-term avenue can do the trick with the power to dial and help you earn more than Rs 1 crore.

Let’s see how?

PPF interest is reviewed quarterly by the government. For the current quarter, PPF will achieve a return of 7.1%.

Now, if we assume that the current interest rate of 7.1% on the PPF remains constant over the long term and that investors regularly store money for 25 years, using the maximum limits of investments allowed during of a fiscal year, he/she can earn a high amount. .

The longer the money remains invested here, the faster it grows.

According to calculations provided by Groww – an investment platform., If someone starts investing Rs 12,500 per month (the maximum monthly investment that can be made in PPF) and continues the PPF account up to 15 years, he/she can earn more than Rs 43 lakh at maturity (in line with the current interest rate of 7.1%).

Now the same account can be extended within one year from maturity for another five years and so on to gain more benefits. After investing Rs 1.5 lakh per year for 20 years (first extension) at 7.1%, the PPF account balance will be around Rs 73 lakh.

Monthly investment Mandate Maturity amount
Rs 12,500 at an interest rate of 7.1% 15 years old Rs 43 million
Rs 12,500 at an interest rate of 7.1% 20 years Rs 73 million
Rs 12,500 at an interest rate of 7.1% 25 years Rs 1,16,60,769

Now, to get Rs 1 crore, the investor has to extend the account for another five years (second extension). After investing Rs 1.5 lakh per year for 25 years at 7.1%, the PPF account balance will be Rs 1,16,60,769 (which is more than 1 crore).

Now that means you need patience and proper investments to do the magic.

Learn more about PPF

PPF offers Exempt-Exempt-Exempt (EEA) tax status and comes with a 15-year lock-in period. The amount at maturity and the aggregate interest earned during the investment period are exempt from tax.

It is best suited for various conservative investors who prefer fixed income investments. This investment enjoys a tax deduction of up to Rs. 1.5 lakh under Section 80C of the Income Tax Act 1961.

Note to readers

The opinions and investment advice expressed by the investment experts on are their own and not those of the website or its management. advises users to check with certified experts before making any investment decisions.

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