fincalculatorPPF Calculator
Estimate the future value of your Public Provident Fund (PPF) investment. Maximize your tax savings with India's most popular government-backed scheme.
The Public Provident Fund (PPF) is widely regarded as one of the best long-term investment tools in India. Backed by the Central Government, it offers the dual benefit of guaranteed returns and complete tax exemption.
For decades, PPF has been the go-to retirement savings vehicle for self-employed individuals and a tax-saving instrument for salaried employees. Our PPF Calculator helps you plan your contributions to build a substantial tax-free corpus over 15 years.
Why use a PPF Calculator?
PPF interest is compounded annually, and the long tenure of 15 years makes manual calculation difficult. This tool helps you:
- Visualize Wealth Creation: See how investing just ₹1.5 Lakhs a year can turn into over ₹40 Lakhs.
- Plan Tax Savings: Determine how much you need to invest to exhaust your Section 80C limit.
- Compare Scenarios: Check the difference in returns if you invest monthly vs annually.
Who Should Invest in PPF?
- Tax Savers: Anyone looking to save tax under Section 80C (up to ₹1.5 Lakhs deduction).
- Conservative Investors: Those who want 100% capital safety with decent returns (better than FDs).
- Retirement Planners: The 15-year lock-in acts as a forced saving for your retirement years.
PPF Interest Calculation Formula
The interest on PPF is compounded annually based on the financial year. The formula for the maturity amount (F) is:
Where:
- F = Maturity Amount
- P = Annual Installment
- i = Annual Interest Rate (in decimals)
- n = Number of Years (default 15)
Calculate Your PPF Returns
Min: ₹500, Max: ₹1.5 Lakhs per year
Total Invested
₹ 0
Interest Earned
₹ 0
Maturity Amount
₹ 0
Example Calculation
Scenario: You invest the maximum limit of ₹1,50,000 every year for 15 years at the current rate of 7.1%.
- Total Investment: ₹1.5 Lakhs × 15 = ₹22.5 Lakhs
- Interest Earned: ₹18.12 Lakhs
- Maturity Value: ₹40.68 Lakhs
The best part? This entire ₹40.68 Lakhs is tax-free!
Golden Rules of PPF
The "5th of the Month" Rule
Interest is calculated on the lowest balance between the 5th and the last day of the month. Always deposit money on or before the 5th to earn interest for that month. If you deposit on the 6th, you lose interest for the entire month!
Withdrawal & Extension Rules
- Lock-in: 15 years.
- Partial Withdrawal: Allowed from 7th year (up to 50% of 4th year end balance).
- Loan: Available from 3rd to 6th year at 1% interest.
- Extension: After 15 years, you can extend in blocks of 5 years.
Frequently Asked Questions (FAQs)
What is the PPF Interest Rate for 2024-25?
The current PPF interest rate is 7.1% per annum. This rate is set by the government and is subject to quarterly revision.
What is the maximum investment limit in PPF?
You can invest a minimum of ₹500 and a maximum of ₹1.5 Lakhs in a single financial year. Any amount exceeding ₹1.5 Lakhs will strictly not earn any interest and is not eligible for tax deductions.
Why is PPF called an EEE investment?
PPF falls under the Exempt-Exempt-Exempt (EEE) category: 1) Investment is tax-deductible u/s 80C. 2) Interest earned is tax-free. 3) Maturity amount is fully tax-free.
When can I withdraw money from my PPF account?
A PPF account matures after 15 years. However, partial withdrawals are allowed from the 7th year onwards subject to certain conditions. Premature closure is allowed only in specific cases (like critical illness) after 5 years.
Can I extend my PPF account after 15 years?
Yes, you can extend your PPF account in blocks of 5 years indefinitely. You can choose to extend it with or without making further contributions.