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Tag: PPF

  • Government hikes rate of interest on five-year recurring deposit to six.7%

    New Delhi: The Centre on Friday raised rate of interest on five-year recurring deposit scheme to six.7% for the December quarter from 6.5%, however retained the charges for all different small financial savings schemes.

    According to a round from the Department of Economic Affairs, rate of interest on financial savings deposits has been retained at 4%, on one-year time period deposit at 6.9%, on two-year and three-year time period deposit at 7%, and on the five-year time period deposit at 7.5%.

    The charges have been the identical in the course of the September ended quarter.

    Meanwhile, the senior residents financial savings scheme will fetch an rate of interest of 8.2% in the course of the December quarter, similar because the earlier quarter.

    The month-to-month revenue account scheme can have an rate of interest of seven.4 % whereas National Savings Certificate can have an rate of interest of seven.7%, and the Public Provident Fund (PPF) scheme can have an rate of interest of seven.1%.

    The rate of interest on Kisan Vikas Patra is 7.5% and investments will mature in 115 months. According to the round, the rate of interest on the favored lady youngster scheme Sukanya Samriddhi Account has been retained at 8%.

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    Updated: 29 Sep 2023, 06:19 PM IST

  • How to change into a crorepati with a Public Provident Fund (PPF) account

    PPF calculator: The Public Provident Fund (PPF) is a well-liked long-term financial savings scheme in India. At current, it provides a 7.1% rate of interest efficient 1 April 2023. For the previous few years, the federal government has not raised this restriction. Investors can open a PPF account in any financial institution or in a close-by put up workplace. However, one must deposit a minimal of ₹500 each year in a single’s PPF account. The most you’ll be able to put right into a PPF account is about at Rs. 1.5 lakh. It takes 15 years for the PPF account to mature.

    How your PPF account could make you a crorepati

    Making a crore can be troublesome with a reasonable funding. But Personal Finance specialists say that PPF can do that trick with the ability of compounding.

    Individuals can lengthen their PPF account in a block of 5 years for an infinite variety of occasions.”When you are extending your PPF account, you should choose an extension with an investment option as it would enable you to get interest on both the PPF maturity amount and fresh investments. In simple words, one can accumulate more than a crore in one’s PPF account at the time of retirement,” stated Kartik Jhaveri, Director of wealth at Transcend Consultants.

    PPF calculator

    If an incomes particular person extends his PPF account twice after the completion of 15 years, he/she is going to have the ability to amass large wealth and change into a crorepati in 25 years. Let’s see how. The PPF account holder is investing ₹1.50 lakh per yr in a single’s PPF account, he can even cut up the cost month-to-month in instalments of RS 8333.3, then after 25 years of funding, one’s PPF maturity quantity can be ₹1,03,08,015 or round ₹1.03 crore, assuming PPF rate of interest for the whole interval at flat 7.10 per cent each year as per the PPF calculator (screenshot under) The invested worth is ₹37,50,000, and the curiosity earned is ₹65,58,015.

     

    View Full Image

    Photo: Courtesy Groww (Photo: Courtesy Groww)

    PPF taxation guidelines

    PPF account falls beneath the EEE class the place one can declare earnings tax advantages beneath Section 80C on one’s annual deposit of as much as ₹1.5 lakh. other than this, one’s PPF maturity quantity can also be tax-exempt.

     

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    Updated: 16 Sep 2023, 02:46 PM IST

  • How do I optimize my portfolio to purchase a home, begin a household?

    My month-to-month wage post-taxes is ₹1.95 lakh. I’ve SIP (systematic funding plans) of ₹15,000 in Axis Bluechip, ₹15,000 in Canara Robeco Small Cap, ₹15,000 in Parag Parekh Flexi Cap since two years and my investments are presently valued at ₹6.83 lakh. Besides, I’ve direct inventory investments valued at ₹6.6 lakh. This additionally consists of ₹47,000 in sovereign gold bonds.

    Since the final 5 years, I’ve been depositing ₹10,000 each month in public provident fund (PPF). My PPF steadiness stands at ₹7 lakh. I’ve been investing ₹50,000 yearly in nationwide pension scheme (NPS) for the final three years.

    I’ve a medical health insurance for me and my spouse and in addition my mother and father. Now, we need to purchase a home, which we count on to value round ₹1 crore. We additionally plan to start out a household subsequent yr. Do we have to tweak our portfolio to handle the bills coming our manner?

    —Name withheld on request

    You have constructed a very good, diversified portfolio. So far, you might have accrued near ₹22 lakh. Out of this, ₹7 lakh is in PPF, so it almost certainly has a lock-in interval. You should depend on a house mortgage to purchase the home. If we think about a mortgage of ₹1 crore for 20 years then the equated month-to-month instalment (EMI) for a similar may very well be roughly ₹87,000 at an rate of interest of 8.5% p.a.

    Based in your take-home wage, you can be eligible to get this mortgage quantity. If you want to take a lesser mortgage then it is best to attempt to save extra out of your month-to-month earnings. Practically, an affordable quantity would additionally go into your month-to-month obligatory bills however you continue to have the potential to avoid wasting extra. These further financial savings will be accrued in your checking account to scale back the mortgage quantity.

    A aim quantity to your baby’s training will aid you construct that corpus over the long run. In this case, you’ll be able to deal with this aim as wealth creation, in addition to you should have greater than 15 to 16 years to construct it.

    You also needs to think about investing to your retirement whereas engaged on the opposite objectives.

    As you’re salaried, you also needs to keep in mind the EPF contribution as a debt funding, therefore investing greater than required in PPF for long-term objectives like retirement is probably not the very best method.

    Equities are good for long-term objectives and fairness mutual funds supply a handy and dependable option to make investments for such objectives. You have already taken the correct step of investing by SIPs and it is best to proceed doing the identical.

    On the funds, you’ll be able to relook at Axis Bluechip Fund because the fund has underperformed its friends for fairly a while, lately. You can divert this SIP into different funds. Some of the funds you’ll be able to have a look at are SBI Large & Mid Cap Fund, 360 One Focused Equity Fund, Kotak Equity Opportunities Fund and PGIM India Midcap Opportunities Fund.

    Harshad Chetanwala is co-founder at MyWealthGrowth.com

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    Updated: 31 Aug 2023, 11:04 PM IST

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  • Which small financial savings scheme to want as PPF, financial institution FD fail to beat inflation

    It’s not solely about saving your cash, and placing them into varied funding instruments. Investors should try to be certain that the returns from the investments are in a position to beat the inflation. It’s a well known undeniable fact that the worth of cash decreases with time. No doubt that financial savings will be as difficult as incomes. To put it merely, inflation is the speed at which the price of items and providers rises over time. In brief, inflation signifies that your cash might not be capable of purchase as a lot sooner or later because it might right this moment.

    However, in mild of India’s retail inflation charge, which was 7.44% in July 2023, neither financial institution fastened deposits (FDs)nor the Public Provident Fund (PPF) is ready to produce inflation-beating returns. Consumer Price Index (CPI)-based inflation shot previous estimates to hit a 15-month excessive of seven.44% throughout July.

    SBI, and ICICI Bank FDs between 7 days to 10 years will give 3% to 7.1% to basic prospects. Axis Bank presents rates of interest starting from 3.5% to 7.3% on deposits maturing in seven days to 10 years for most people, whereas HDFC Bank presents 3% to 7.25% on these deposits.

    Small financial savings schemes that beat inflation

    Sukanya Samriddhi Yojana (SSY): The fashionable woman youngster financial savings scheme Sukanya Samriddhi Yojana account will earn an rate of interest of 8%.

    National Savings Certificate (NSC): It has a lock-in interval of 5 years. This will fetch 7.7% curiosity.

    Post Office Monthly Income Scheme (MIS): This permits traders to generate a gentle month-to-month earnings, and provides an rate of interest of seven.4%.

    Kisan Vikas Patra: KVP is giving an rate of interest of seven.5%

    Senior Citizen Savings Scheme (SCSS): Investors who’re 60 years outdated can deposit as much as ₹30 lakh over their lifetime in a Senior Citizen Savings Scheme to earn common curiosity earnings. The senior residents’ scheme offers 8.2%.

    Mutual Fund SIPs have the potential to outperform inflation

    According to cash consultants, investing in Mutual Fund SIPs might help you construct wealth and produce returns that outperform inflation. 

    On August 10, the Reserve Bank of India (RBI) Monetary Policy Committee (MPC) determined to maintain the repo charge unchanged at 6.5 per cent for the third time in a row.

     

     

     

     

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    Updated: 29 Aug 2023, 03:13 PM IST

  • PPF vs Sukanya Samriddhi vs SCSS: Post Office saving schemes charges in contrast

    India Post gives eight deposit choices for traders, generally often called publish workplace saving schemes. These eight small saving schemes embrace Public Provident Fund (PPF), Sukanya Samriddhi Yojana (SSY), National Savings Certificate (NSC), Post Office Time Deposit for a 5-year time period, and Senior Citizen Savings Scheme (SCSS). Interest charges for small financial savings schemes are notified on a quarterly foundation. The below-mentioned rates of interest are for the July-September 2023 quarter.

    Public Provident Fund (PPF) newest charges

    PPF is a long-term tax financial savings scheme, which matures in 15 years.  A minimal deposit of ₹500 per 12 months is required to maintain the account energetic. This will fetch 7.1%.

    Senior Citizen Savings Scheme (SCSS) newest charges

    Investors who’re 60 years previous can deposit as much as ₹30 lakh over their lifetime in a Senior Citizen Savings Scheme to earn common curiosity earnings. The senior residents’ scheme provides 8.2%.

    Sukanya Samriddhi Yojana (SSY) newest charges

    The fashionable lady youngster financial savings scheme Sukanya Samriddhi Yojana account will earn an rate of interest of 8%. 

    National Savings Certificate (NSC) newest charges

    National Savings Certificate has a lock-in interval of 5 years. This will fetch 7.7% curiosity.

    Post Office Monthly Income Scheme (MIS) newest charges

    MIS permits traders to generate a gradual month-to-month earnings, and offers an rate of interest of seven.4%.

    Kisan Vikas Patra (KVP) newest charges

    The Kisan Vikas Patra (KVP) is giving an rate of interest of seven.5%

    5-Year Post Office RD newest charges

    With small month-to-month investments, these RD accounts provide profitable rates of interest. This recurring deposit scheme provided by publish workplaces will get new traders 6.5%

    Post Office Time Deposit Account newest charges

    You can even open time deposits as a publish workplace saving scheme for 1, 2, 3, and 5 years of tenure. It is just like mounted deposits provided by banks. 

    1-Year Deposit – 6.9%

    2-Year Deposit – 7.0%

    3-Year Deposit – 7.0%

    5-Year Deposit – 7.5%

    The RBI has maintained the established order on coverage charge within the final three consecutive Monetary Policy Committee conferences.

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    Updated: 21 Aug 2023, 02:47 PM IST

  • Small financial savings schemes rates of interest hiked by 30 bps for July-September quarter

    The rate of interest on small financial savings schemes for July-September quarter has been raised by 10-30 foundation factors and now vary from 4.0 p.c to eight.2 p.c, the finance ministry stated on June 30.

    The announcement was made by the Ministry of Finance on Friday. The rates of interest on small financial savings schemes are usually reviewed each quarter by the federal government. While declaring small financial savings rates of interest for the earlier quarter, the federal government introduced as much as 70 bps rate of interest hikes for varied small saving schemes.

    The rates of interest supplied by the Government on many of the small financial savings schemes, together with Post Office Fixed Deposit, are already at par with time period deposits supplied by banks.

    The small financial savings rates of interest, whereas set by the federal government, are linked to market yields on G-secs with a lag and are reviewed, fastened on a quarterly foundation at a diffusion starting from 0-100 foundation factors over and above G-Sec yields of comparable maturities, as per the Reserve Bank of India.

    Interest fee hikes within the final quarter

    The authorities has raised the speed of curiosity on varied Small Savings Schemes for the April to June quarter. The rate of interest on the Senior Citizen Savings Scheme was hiked by 20 foundation factors, National Savings Certificate by 70 foundation factors, Kisan Vikas Patra by 30 foundation factors, and Sukanya Samriddhi Yojana by 40 foundation factors.

    Interest fee hikes in January to March interval

    In the January-March interval, the Centre hiked the rates of interest on a number of the small financial savings schemes. The authorities elevated the rate of interest for 1-year, 2-year, 3-year, and 5-year time period deposits. Besides this, it has additionally elevated the rate of interest for the Senior Citizens’ Savings Scheme, Monthly Income Scheme, and the National Savings Certificate.

     

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    Updated: 30 Jun 2023, 05:46 PM IST

  • Will your Public Provident Fund account yield extra in coming quarter?

    Public Provident Fund (PPF) rate of interest: The rates of interest of small financial savings schemes are due for revision right this moment, 30 June 2023. People are questioning whether or not the govt. will hike the rate of interest of the Public Provident Fund (PPF)  within the July-September quarter as PPF rates of interest have remained unchanged since April 2020. At current your PPF deposits fetch you 7.1 per cent.

    While declaring small financial savings rates of interest from April 2023, the central authorities introduced a ten bps to 70 bps rate of interest hike for numerous small saving schemes, which embody the Senior Citizen Savings Scheme, Sukanya Samriddhi Account Scheme, Monthly Income Savings Scheme, National Savings Certificate, Kisan Vikas Patra, and all publish workplace time deposits. However, the GoI determined to depart Public Provident Fund (PPF) rate of interest unchanged at 7.10 per cent.

    The rates of interest on small financial savings schemes are sometimes reviewed each quarter by the federal government.

    How to open PPF accounts?

    PPF accounts could be opened in any PSU or personal financial institution. It has a maturity interval of 15 years and a PPF account could be opened with a minimal ₹100 deposit. However, one must deposit a minimal of ₹500 in a single monetary yr to maintain one’s PPF account in lively mode. 

    PPF and taxation rule

    Under Section 80C of the revenue tax act, an incomes particular person can declare an revenue tax rebate on as much as ₹1.50 lakh funding in a single’s PPF account in a single monetary yr.

    PPF rate of interest calculation

    Explaining PPF rate of interest calculation, SEBI registered tax and funding knowledgeable Jitendra Solanki mentioned, “PPF interest is calculated on the basis of minimum balance from 5th to last date of the month. So, if a PPF account holder deposits on or before the 4th date of the month, then in that case the PPF account holder will be able to earn PPF interest of that month as well.”

    This means, if an investor invests by the 4th of April in a single’s PPF account, then the PPF account holder will get curiosity on one’s deposit within the month of April in addition to PPF curiosity shall be calculated on the minimal PPF steadiness from the fifth ofApril to thirtieth April 2023.

    “As per paragraph 3 of the Public Provident Fund Scheme, 2019, any father or mother or authorized guardian can open a Public Provident Fund account within the title of a minor baby. Please observe that no more than PPF one account could be opened within the title of an individual. Under the PPF scheme, 2019 there isn’t any restriction on any of the dad and mom or each dad and mom contributing to the PPF account of a minor baby,” mentioned tax and funding knowledgeable Balwant Jain.

     

     

     

     

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    Updated: 30 Jun 2023, 09:59 AM IST

  • Mutual fund funding: These flexi-cap schemes beat PPF, financial institution FD returns

    Before selecting a mutual fund (MF), buyers ought to do a correct danger evaluation of the funds earlier than they spend money on them. They should weigh the professionals and cons of various classes of mutual fund schemes- flexi cap,  multi-cap, index fund focussed funds, amongst others. 

    Flexi-cap mutual funds

    Flexi-cap schemes spend money on securities throughout market capitalisation comparable to large-cap, mid-cap, and small-cap. The minimal funding in fairness and equity-related devices needs to be 65 p.c of the whole property of the scheme in flexi-cap mutual funds. This class was launched in November 2020.

    Best Flexicap Mutual FundsDr. Ravi Singh, Vice President and Head of Research, at Share India, has shared three high flexi-cap mutual funds for the very best return in your cash

    1)JM Flexicap Fund with 17.15% return in a single 12 months

    2)HDFC Flexi Cap Fund with 16.93% return in a single 12 months

    3)ICICI Prudential Flexicap Fund with a return of 15.39% in a single 12 months 

    Vinit Khandare, CEO and Founder, MyFundBazaar listed three high funds for investing in flexi-cap

    1)HDFC Flexi Cap Fund 

    2)ICICI Prudential Flexi Cap Fund 

    3)Edelweiss Flexi Cap Fund 

    Tax and funding knowledgeable Balwant Jain urged one finest flexi-cap mutual fund

    1) Parag Parekh

    Pankaj Mathpal, MD & CEO at Optima Money Managers listed one high fund for investing in flexi-cap

    1)ICICI Prudential Flexi Cap Fund- Pankaj MAthpal

    Here are ten fairness flexi-cap funds which have produced profitable SIP returns in a single 12 months as per Value Research.

    JM Flexicap Dir- 32.13

    360 One Focused Eqt Dir- 30.18%

    HDFC Flexi Cap Dir- 30.10%

    DSP flexi Cap Dir- 27.33%

    Franklin Ind Focuses Eqt Dir- 26.75

    Bank of India Flexi Cap Dir- 26.64%

    Edelweiss Flexi Cap Dir- 25.88%

    Canara Robeco Focuses Eqt Dir- 25.86%

    Franklin Ind Flexi Cap Dir- 24.37

    Bandhan Focussed Equity Dir- 23.22%

    Meanwhile, buyers continued to park their cash in mutual funds, with contributions in SIPs reaching a brand new excessive of ₹14,749 crore in May. 

    This strong influx has led to property beneath administration of SIP rising by 5 per cent to ₹7.53 lakh crore final month from ₹7.17 lakh crore in April.

    The surge in SIP inflows amid greater cancellations reveals that new buyers proceed to take a position extra money than the typical ticket dimension.

    Disclaimer: The views and proposals made above are these of particular person analysts, and never of Mint. We advise buyers to test with licensed specialists earlier than taking any funding selections.

     

     

     

     

     

     

     

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    Updated: 29 Jun 2023, 02:18 PM IST

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  • Public Provident Fund (PPF) vs Fixed Deposit(FD): Which is healthier for traders

    When evaluating the PPF and FD as funding choices in India, it is necessary to contemplate varied elements. 

    Advantages of PPF

    The PPF, being a government-backed financial savings scheme, supplies a number of benefits. 

    1)Firstly, contributions to PPF are eligible for tax deductions underneath Section 80C of the Income Tax Act, which can assist cut back your tax legal responsibility.  Additionally, the curiosity earned and the maturity quantity are tax-free, making it a lovely choice from a tax perspective. 

    2)PPF can also be thought-about a protected funding since it’s backed by the federal government, offering a way of safety to traders.

    3)“PPF provides a 7-year lock-in interval and a 15-year deposit period, making it an interesting long-term investing choice. An individual could proceed to take action indefinitely in blocks of 5 years after the preliminary 15 years have handed,” said Vinit Khandare, CEO and Founder, MyFundBazaar

    4)Another advantage of PPF is that it allows for partial withdrawals and offers loan facilities after the completion of the 7th year, providing some degree of liquidity during emergencies or financial needs, said Amit Gupta MD, SAG Infotech.

    5)A PPF account can be opened with a minimum investment of Rs. 500 and a maximum investment of Rs. 1,50,000 every fiscal year.

    6)For a period of 15 years, individuals may deposit money into their PPF accounts at least once annually.

    On the other hand, FDs offer their own set of advantages.

    Advantages of FD 

    1)They provide flexibility in terms of tenure options, allowing individuals to choose a time frame that aligns with their specific needs and financial goals. 

    2)The interest rates that apply to fixed deposits remain constant at the rate that the individual has booked the FD, independent of changes in the market. This guarantees fixed returns upon maturity, said Khandare

    He added that depending on the investment goal, a person may choose between short- and long-term fixed deposits. The term can be for as little as seven days or as long as ten years.

    3)“FDs also offer a regular income stream in the form of fixed-interest payments, which can be useful for individuals seeking a predictable cash flow,” stated Amit Gupta.

    Moreover, FDs are simply accessible and will be opened with varied banks and monetary establishments, making them a handy funding choice, he added.

    4)Most banks present a better mounted price of curiosity to aged of us. As a end result, it permits senior residents to save lots of extra money with out taking any dangers.

    5)Tax-saving mounted deposit plans can support in lowering revenue tax obligations. Section 80C of the Income Tax Act of 1961 permits traders to assert tax exemptions as much as a most of Rs. 1,50,000.

    6) Cumulative FDs that compound curiosity each six months, three quarters, or month-to-month. This ensures larger returns on the principal sum.

    “However, it is necessary to contemplate the drawbacks as properly. While PPF provides tax advantages, FDs are topic to tax on the curiosity earned as per the person’s tax slab. Additionally, FD returns could not all the time outpace inflation, which suggests the actual worth of financial savings would possibly lower over time. It’s essential to take inflation into consideration when evaluating the potential returns from FDs. Furthermore, FDs should not assured by the federal government, though deposits as much as Rs. 5 lakh per financial institution are insured by the Deposit Insurance and Credit Guarantee Corporation (DICGC),” stated Amit Gupta MD, SAG Infotech

    Ultimately, the selection between PPF and FD is determined by particular person preferences, monetary targets, danger tolerance, and liquidity necessities. PPF fits people searching for long-term financial savings with tax advantages and a safe funding choice. On the opposite hand, FDs provide extra flexibility and liquidity, making them appropriate for people who could require entry to their funds within the shorter time period. It’s all the time advisable to judge your particular wants, contemplate the professionals and cons, and seek the advice of a monetary advisor to make an knowledgeable choice that aligns along with your monetary aims.

    PPF’s newest rate of interest

    The Public Provident Fund (PPF) is without doubt one of the well-liked long-term funding schemes backed by the Government of India. PPF provides an rate of interest is 7.1%.

    Latest financial institution FD rates of interest

    Axis Bank, State Bank of India, and ICICI Bank provide ain rates of interest starting from 3% to 7.1% on tenures maturing in 7 days to 10 years, whereas HDFC Bank offers rates of interest starting from 3% to 7.25% on these deposits to normal clients.

    Disclaimer: The views and proposals made above are these of particular person analysts, and never of Mint. We advise traders to verify with licensed consultants earlier than taking any funding selections.

     

     

     

     

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    Updated: 14 Jun 2023, 01:56 PM IST