How PPF can help you and your spouse to create 1 crore?
There are many different investment options for making one crore. Most of the options have a high risk. If you are thinking to opt lower risk investment schemes then PPF would be the best option. If you and your spouse are thinking of accumulating rupees 1 crore, PPF is still the best investment option. You will get an income tax exemption u/s 80C and will get safe stable returns and create 1 crore.
Rupees 1 crore is a very huge amount but it depends on the need of the money. But we Indians always have a dream of being a crorepati. PPF is a beautiful short term investment scheme which has a lock-in tenure of 15 years. The interest amount received on PPF is completely tax exempted. The PPF amount which the account holder receives on maturity is tax exempted.
How you and your spouse can make it to rupees 1 crore using PPF?
The interest rate of PPF is currently 8% per annum and it is compounded per year. The Indian government make changes on interest rates quarterly. The government while revising the rates, keep in mind the huge number of people invest in PPF. Some cases or scenarios where you and your spouse will be able to create 1 crore rupees are:
Case 1) The maximum amount one can invest in PPF is rupees 1.5 lakhs. An average of 8% interest rate, you and your spouse need to invest rupees 1.5 lakhs per year each. You need to invest this amount for 17 years stretch with a total of rupees 3 lakhs per year. By this scenario, you would invest rupees 51 lakhs and your investment will rise to rupees 1.02 Crores.
Case 2) The interest rates fall to 7 per cent, and then also you need to invest rupees 1.5 lakhs per year. Similarly, you and your spouse will be investing 3 lakhs per annum but for 18 years. As an outcome of this scenario, you have invested rupees 54 lakhs. And the investment has grown to rupees 1.02 crores.
Case 3) Consider that an average 6.5% of interest rate on PPF. You need to invest rupees 1.5 lakhs each year for both of you and your spouse. That’s a total of rupees 3 lakhs per annum but this time for 19 years. Rs 3 lakhs X 19 years would sum up to rupees 57 lakhs investment. Thus, by this time you and your spouse would have grown a whopping amount of rupees 1.7 crores.
Case 4) Considering the current interest rate of 8% and you want to invest rupees 1.1 lakhs per year. You and your spouse would make a total of rupees 2.2 lakhs per annum but for 20 years. This scenario would result in a total of rupees 44 lakhs invested. Your investment will total rupees 1 crore.
The possible cases would result in you and your spouse create rupees 1 crores using PPF scheme.