New Post Office Scheme: Get ₹40 Lakh Tax-Free in Just 15 Years! This Post Office Scheme and Get Here’s How
New Post Office Scheme: Building a significant financial corpus for the future requires disciplined and smart investing. For those looking for a secure, government-backed investment that also offers excellent tax benefits, the Post Office’s Public Provident Fund (PPF) Scheme stands out as a top choice. With a modest monthly investment, you can accumulate a substantial, tax-free amount over the long term.
A well-planned investment strategy in the PPF can turn a monthly deposit of just ₹12,500 into a maturity amount of over ₹40 lakh. Let’s explore how this is possible and delve into the features that make this scheme so attractive for investors.
The Path to a ₹40 Lakh Corpus
The magic behind wealth creation in the PPF scheme lies in the power of compounding. The interest earned each year is added to the principal, and the next year’s interest is calculated on this new, larger principal. This process accelerates your savings growth significantly over time.
To achieve the goal of over ₹40 lakh, you need to invest the maximum permissible amount, which is ₹1,25,000 per month or ₹1.5 lakh per financial year.
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Join on TelegramHere is a breakdown of the calculation based on the current interest rate of 7.1% per annum:
| Particulars | Amount (₹) |
|---|---|
| Monthly Investment | 12,500 |
| Annual Investment | 1,50,000 |
| Investment Period | 15 Years |
| Total Principal Invested | 22,50,000 |
| Total Interest Earned | 18,18,209 |
| Maturity Value (Approx.) | 40,68,209 |
As the table shows, a disciplined investment of ₹12,500 per month for 15 years results in a total deposit of ₹22.5 lakh, which grows to a tax-free corpus of approximately ₹40.68 lakh upon maturity.
Key Features of the PPF Scheme
The Public Provident Fund is not just about high returns; it’s a comprehensive savings tool with several investor-friendly features.
- Investment Limit: You can start a PPF account with a minimum deposit of just ₹500 and a maximum of ₹1.5 lakh in a financial year.
- Maturity Period: The scheme has a lock-in period of 15 years. After maturity, it can be extended in blocks of 5 years with or without further contributions.
- Interest Rate: The interest rate is set by the government and reviewed every quarter. The current rate (as of the latest quarter) is 7.1% per annum, compounded annually.
- Loan Facility: Investors can avail a loan against their PPF balance from the third to the sixth financial year.
- Partial Withdrawal: Premature withdrawal is permissible from the seventh financial year onwards, subject to certain conditions.
Unmatched Tax Benefits
One of the most significant advantages of the PPF scheme is its Exempt-Exempt-Exempt (EEE) tax status.
- Exempt (Investment): The amount you invest (up to ₹1.5 lakh per year) is eligible for tax deduction under Section 80C of the Income Tax Act.
- Exempt (Interest): The interest earned annually on your PPF balance is completely tax-free.
- Exempt (Maturity): The final maturity amount, including the principal and accumulated interest, is also fully exempt from tax.
This triple tax benefit makes the effective return on PPF much higher than many other fixed-income instruments, making it an essential part of any long-term financial plan.
