By investing in the Post Office's Public Provident Fund (PPF) scheme, you can build a secure and tax-free fund for your children over 15 years. Saving ₹70 daily can accumulate approximately ₹6.78 lakh in 15 years. This scheme offers long-term savings and high returns even on a small budget.
Post Office Scheme for Child Education: The Post Office's Public Provident Fund (PPF) scheme offers a secure option for children's future education and significant expenses. By depositing small amounts regularly for a set period, one can receive a substantial sum upon maturity. Investing just ₹70 daily for a 15-year tenure can help create a fund of approximately ₹6.78 lakh. This government-guaranteed scheme is tax-free and risk-free, enabling robust long-term savings even with a small budget.
Big Fund from Small Savings
The PPF scheme is a reliable and secure option for long-term investment. It allows investments ranging from a minimum of ₹500 to a maximum of ₹1.5 lakh annually. The tenure for this scheme is 15 years. Regular investments for 15 years yield a good sum upon maturity. The scheme currently offers an annual interest rate of 7.1 percent, which is entirely tax-free. This is why the scheme is considered highly beneficial for the middle class.
Impact of Saving a Little Daily
If you save just ₹70 daily, the amount accumulates to ₹2,100 per month. Annually, this investment amounts to ₹25,200. Investing consistently for 15 years totals approximately ₹3.75 lakh. Adding the 7.1 percent annual interest on this amount results in a fund of roughly ₹6.78 lakh upon maturity. This sum can be extremely useful when a lump sum is needed for children's higher education or a significant college course.
Safety in Investment
The PPF scheme is operated by the government, making investments completely secure. It is not affected by market fluctuations. Furthermore, both the interest earned and the maturity amount under this scheme are completely exempt from income tax, offering investors a dual benefit. On one hand, regular small savings build a substantial fund, and on the other, tax relief is also provided.
Benefits of the Scheme
- This scheme helps in timely fund creation for children's education or future significant expenses.
- The interest rate is fixed, allowing for easy estimation of the future receivable amount.
- Investment is secure due to government backing.
- Tax exemption offers additional benefits to the investor.
- Even with a small budget, consistent long-term investment builds a b fund.
Amount to be Deposited
You can start with a minimum annual deposit of ₹500 in this scheme. The maximum investment limit is ₹1.5 lakh. If you invest regularly, small deposits grow into a substantial amount over time. For instance, depositing ₹70 daily can build a fund of up to ₹6.78 lakh in 15 years.
Why is This Scheme Special
The PPF scheme serves effectively for children's education and future security over the long term. Not only is the scheme secure, but it also instills a habit of regular saving. Additionally, the tax benefits make it even more attractive to investors. By depositing a small amount, you can build a large fund over a long period.
