These two tricks give high interest on PPF, did you know?

New Delhi. Due to tax breaks, good interest and no risk of losing money, Public Provident Fund or PPF is a popular savings scheme. Some people get more interest than others on the money invested in PPF. It is not that the government gives them special interest, rather they invest money and get more benefits after understanding the rules of PPF properly. So, if you invest after knowing the rules of PPF properly, you will also benefit more.

PPF account can be opened at post office or any bank branch. Currently, the government is paying 7.1% interest on the money invested in PPF. On investing in PPF, tax exemption up to Rs 1.5 lakh is available under Section 80C of Income Tax. A minimum of Rs 500 and a maximum of Rs 1,50,000 can be deposited in a PPF account every year. Interest on this amount is credited to the account on the last day of every financial year. You can get more interest by doing two things. Today we will tell you only about them.

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Deposit by 5th.
If you invest in PPF every month, the money should be deposited in PPF between 1st to 5th of every month. As per PPF rules, interest in provident fund account is calculated on the amount deposited in the account between the last date and 5th of the month. You will not get any interest on the amount deposited after 5th and you will start getting interest on the amount from the next month. Therefore, in any case, the amount should be deposited by 5th.

This way you can get the most out of compound interest.
Compound interest is available on the amount in PPF. To get higher interest on the amount deposited in PPF account, you should invest the entire amount at the beginning of the financial year itself. This means whatever amount you want to invest in PPF in a year, deposit it all together by 5th April. By doing this you will earn interest on the entire amount from the beginning to the end of the year and you will get more profit.

Avoid withdrawal
To get higher interest from Public Provident Account, you should avoid frequent withdrawal from PPF account. Withdraw money only if absolutely necessary. Due to frequent withdrawals, the minimum balance parameter gets distorted and the person is not able to earn the required interest amount.

Tags: interest rate, Money making tips, Personal Economics, PPF account