Raksha Bandhan 2024 gifts guide: Brothers can choose to open a Public Provident Fund (PPF) account for their sisters which would be an excellent Rakhi gift. New Delhi: Raksha Bandhan 2024 festival will be celebrated on August 19, 2024. On this day, sisters tie rakhi on their brothers’ wrists and pray for their well-being while brothers usually shower them with gifts.
One great idea for a gift is to open a Public Provident Fund (PPF) account in your sister’s name. This is a popular and secure investment in India that can help her achieve long-term financial goals. What are PPF account benefits? Brothers looking to surprise their sisters and also wanting a guaranteed substantial returns risk-free scheme, PPF comes as one of the most popular investment plans which is meant to invest valuable capital for long term benefits.
The current PPF interest rate is 7.1 per cent. The most beautiful aspect of PPF is that it allows a minimum deposit of Rs 500/- and a maximum deposit of Rs 1,50,000/- in a financial year.
The beneficiary will get the maturity amount on completion of 15 complete financial years from the end of the year in which the account was opened. The scheme is controlled by the central government and financial institutions like Post Office, several banks, allow one to open a PPF account. Notably, it is not compulsory to have a savings account in a bank to open a Public Provident Fund account.
The maturity period is 15 years but the same can be extended within one year of maturity for further 5 years and so on. The beneficiary can retain the account indefinitely without further deposit after maturity with the prevailing rate of interest. Important note: Premature closure is not allowed before 15 years in PPF scheme.
The beneficiary can enjoy tax benefits as PPF deposits qualify for deduction from income under Section 80C of IT Act. The interest earned is completely tax-free. The beneficiary is allowed to withdraw every year from the 7th financial year from the year of opening the account.
PPF calculator Let’s assume the rate of interest in PPF remains unchanged for the next 15 years. If a person invests Rs 1,000 a month for 15 years. The beneficiary will be entitled to get a total payment of Rs 3,15,572 at the end of the 15-year period.
The total deposit will be Rs 1,80,000 and the interest will amount to 3,15,572..
