If you invest in Public Provident Fund i.e. PPF included in the best options for investment, then this news is very special for you. Actually, the 5th of the month is very special for those investing in this fund. If you make your monthly investment before April 5, then you also get the entire interest of that month, but if you are not able to do this, you do not get this interest. In such a situation, you have a chance till 5 April 2024, to settle this work. Let’s understand in detail its complete calculation …
Better Investment Option PPF
Most professionals in PPF invest to save tax saving, but if you invest money with a little wisdom, you will be able to take advantage of excellent returns. The first thing to invest in PPF should be made monthly, and every month you must deposit the money by 5th, so that you will get interest for that month as well. Along with investment in PPF, maturity amount and interest are also tax free. This is a better way to make safe investment and big funds in the long term. On investment in PPF account, Rs 1.50 lakh is received under Section 80C.
The 5th of the month is special for investment
If you invest outright in every financial year in PPF, then investing by April 5 will prove to be even more beneficial for you. Talking about the reason behind this, calculation of interest is done in PPF account according to the 5th of every month. It is clear that if you deposit the lump sum amount by April 5 of the beginning of every financial year, then you can get the benefit of the interest of the whole month.
If a person invests himself in the PPF account till the 5th of the month, then he gets the benefit of the interest of the entire month on the deposit amount. Whereas if invested after the 5th, then you get the benefit of interest only on the lowest balance between 5 to 30th.
This is the calculation of benefits
Calculation of interest on PPF account is done on a monthly basis, but it is deposited in the account at the end of every financial year. Talk in detail, this time if you deposit Rs 1.5 lakh in your PPF account before April 5, 2025, then the entire amount will be taken into consideration for the calculation of interest for that month. That is, based on the current interest rate of 7.1%, you will get an interest of Rs 10,650 annually.
On the other hand, if you complete the transaction after April 5, then you will not be able to get the interest of the first month. Meaning, interest will be available for only 11 months of the financial year except April and it will be Rs 9,762.50 on a deposit of Rs 1.5 lakh on calculating according to the interest rate.