Know 5 Big things before investing in PPF Scheme
PPF Scheme Features: Public Provident Fund is one of the most popular saving schemes. However, most investors are not aware of the features and benefits of this scheme. If you are also thinking of investing in this scheme, you should know the essential things related to this scheme. The five big things related to this scheme are as follows.
1. Guaranteed returns get but not interest is fixed
The interest rate on PPF is not fixed but linked to a 10 -year government bond yield. However, the interest rate on PPF does not change every day, but at the beginning of every quarter, the interest rate is fixed based on the average of the three-month bond yield.
2. Lock-in period not 15 years old
PPF is a long-term investment option. Its tenure is 15 years, but this does not mean that your amount is locked for 15 years. The 15 -year term account is counted from the day of opening. With the passage of every year, the lock-in period decreases. Along with this, investors have a partial withdrawal option after six years. Some investors also see PPF as an emergency fund.
3. Tenure can be increased
PPF account is mature in 15 years. At the time of maturity, subscribers can withdraw the entire amount. However, it can extend the account for five to five years even after maturity. You can extend the account without continuing contribution. To extend the account, you have to inform the bank or post office in writing within one year of the account maturity.
4. Can take PPF cheap loans
If you have a PPF account, you can take a loan from PPFPublic Provident Fund (PPF) Scheme between the third to the sixth year of opening the account. You cannot take a loan of more than 25 per cent of the amount deposited in your PPF account at the end.
5. Take care of maximum investment and minimum investment
In Public Provident Fund, you have to invest at least Rs 500 in a financial year. At the same time, you can invest up to Rs 1.5 lakh in a financial year.