Here Are The Options Available When Your Ppf Account Matures After 15 Years

When it involves planning for retirement, nothing works higher than investing within the Public Provident Fund (PPF). The curiosity rate on PPF for this quarter ending on June 30, 2022, is 7.1 per cent compounded on an annual foundation. The contributions to this funding possibility are tax-exempt underneath Section 80C of the Income Tax Act. The maturity proceeds are additionally tax-free, thus, making it a viable funding possibility.


While all the pieces appears good about PPF, some buyers are apprehensive owing to its 15-year lock-in interval. However, that is like most different monetary devices the place time is a necessary think about serving to to compound returns and create wealth. How you deal with the proceeds of this funding makes it completely different from others. This is as a result of PPF provides you the flexibleness to reinvest the maturity quantity that you simply earn on the prevailing curiosity rate.

Investment choices

Your monetary objectives have a direct bearing on the way you resolve in your investments. Once you may have obtained the maturity quantity, you possibly can take into account extending the maturity quantity for 5 extra years. If you don’t want the maturity quantity instantly and are already incomes, you possibly can take into account availing of this Extension-with-Contributions possibility.

Investors at all times love to decide on what they wish to do with their money. Like they want to select the place they want to park their financial savings for returns that beat inflation whereas availing them of the advantages of tax exemption. Similarly, they want to train extra choices relating to the quantity they obtain as proceeds from the investments they’ve made. Unlike most funding choices, PPF account holders can

Close the PPF account

You shut the PPF account and credit score the proceeds to your financial savings account with out having to fret about paying taxes on the corpus quantity.

Extension sans contribution

You can prolong the PPF account by 5 or extra years with out worrying about having to proceed your contributions to the account. The corpus quantity collected within the account can be utilized to gather curiosity for all these 5 years.

Adhil Shetty, CEO, says, “The relevant rate of curiosity can be the identical because the PPF curiosity for the year. You have the choice to increase your PPF account indefinitely in blocks of 5 years. At 7.1 per cent returns on PPF are nonetheless on the upper aspect in contrast with small financial savings devices. As rates of interest rise, the returns on PPF may even improve. Moreover, as investments develop via compounding, the longer you keep invested, the higher.”

Withdrawal from this account is permitted topic to the restrict of just one withdrawal each year. This means that you could be withdraw in small sums each year or a lump sum in a single specific year whereas leaving the remainder of the corpus to garner curiosity over the remaining interval.

Extension with contributions

You may additionally proceed to make the minimal contributions through the extension interval. This signifies that other than the corpus, you earn curiosity on the recent accumulations too. However, this comes with some restrictions relating to the withdrawal restrict too. For instance, throughout these 5 years of your PPF account extension, you possibly can withdraw solely 60 per cent of the maturity quantity accrued at the beginning of the extension interval. Also, just one withdrawal per year is allowed.

Inform your level of buy

It doesn’t matter should you had opened a PPF account with a financial institution or a submit office. Make positive that you simply inform the financial institution or submit office about your alternative of extension. This is vital, particularly, should you want to select the Extension-with-Contribution possibility.

Extending your PPF account for 5 years submit the maturity interval of 15 years appears a good and viable possibility if you’re investing from a long-term perspective.

Whether you wish to select the extension or not is dependent upon your imminent money necessities and long-term monetary objectives. For instance, if you’re aged round 40 years outdated and have sufficient earnings to fall again upon, chances are you’ll take into account extending the account for 5 years with or with out extension relying on the corpus you might be on the lookout for.

However, when you’ve got retired, chances are you’ll take into account withdrawing your entire maturity quantity or 60 per cent of the corpus amassed earlier than extending the account for an additional 5 years.


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