PPF Calculator: How much money will you get after 15 years by depositing ₹5,000 every month into a PPF account? Find out..

PPF Calculator: Whether you are a salaried employee or a business owner, everyone needs to save for the future. The question is: where should you invest your money to ensure both safety and good returns? The Public Provident Fund (PPF) is a government-backed savings scheme designed for this very purpose. You can start investing with even a small amount. A key advantage is that both the interest earned and the maturity amount are tax-free.

Now, if you deposit ₹5,000 into your PPF account every month, how much will you have after 15 years? Let’s look at the full calculation.

How much will the fund grow to with a monthly deposit of ₹5,000?

Currently, the PPF offers an annual interest rate of 7.1%. Assuming this rate remains constant for the next 15 years and you deposit ₹5,000 before the 5th of each month, you could receive approximately ₹15.78 lakh upon maturity.

Over this period, your total investment would be ₹9 lakh, with an additional ₹6.78 lakh accrued as interest. In other words, over 15 years, a significant portion of your final corpus will come from the interest earned.

Parameter    Details
Monthly deposit amount
₹5,000
Annual investment    ₹60,000
Investment tenure    15 years
Total investment    ₹9,00,000
Estimated interest    ₹6,78,000
Total amount at maturity
₹15,78,000

Deposit your money before the 5th of each month

The date on which you deposit money into your PPF account is also important. Interest is calculated based on the lowest balance in the account between the 5th and the last day of each month. Therefore, if you make your deposit before the 5th of the month, you can earn interest for that month as well. Conversely, if you deposit money after the 5th of the month, you will not earn interest on the new deposit for that month. Therefore, it is advisable to make your investment at the beginning of each month.

What is the investment limit for a PPF account?

A PPF account is opened for a tenure of 15 years. You can deposit a minimum of ₹500 and a maximum of ₹1.5 lakh in a single financial year. You may choose to deposit funds in monthly installments or as a lump sum; both options are available.

The account matures after 15 years, at which point you can withdraw the entire corpus. If you do not have an immediate need for the funds, you can extend the account in blocks of 5 years.

Tax benefits on investments

A key feature of the PPF is its tax benefit. The amount deposited, the interest earned, and the maturity proceeds are all tax-free. However, the tax deduction under Section 80C is available only to those who opt for the old tax regime.

Overall, the PPF is a suitable option for those looking to build secure, long-term savings. It should be noted, however, that the current interest rate of 7.1% is not guaranteed for the entire 15-year duration. The government reviews the interest rates for small savings schemes every three months; consequently, the final maturity amount may vary.

Disclaimer: This content has been sourced and edited from Money Control. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.