Savings Scheme: Child will get Rs 24,000 every month, open an account in this government scheme as soon as he is born

PPF: When children are 18 or 20 years old, they need higher education. Fees for higher education is a different aspect, they also need monthly expenses during studies, so that they can complete their education without any tension.

PPF: When children are 18 or 20 years old, they need higher education. The fees for higher education is a different aspect, during studies they also need monthly expenses so that they can complete their education without tension. Today, if they can manage with a monthly expenditure of 8 to 10 thousand, then after 18 or 20 years, they will need at least 24,000 rupees as pocket money. If you invest wisely in their name, then this task will become very easy.

What should parents do?

Parents can open a PPF (Public Provident Fund) account in the name of the child at the time of birth or a year or two after birth. According to the rules, Public Provident Fund account can be opened in the name of minor children, which they get the right to manage when they turn 18 years old.

After this scheme matures, it can also be used as a monthly income. There is a rule to extend the Public Provident Fund even after maturity and to withdraw from it. By taking advantage of this special rule, a tax-free income of Rs 24,000 can be earned every month. This can be useful for your child’s monthly expenses.

Maturity and interest rate

Maturity period of PPF: 15 years

Current interest rate: 7.1 percent per annum

PPF: How much fund will be created after 15 years of maturity

PPF Calculator: If you make maximum deposit in every financial year till maturity in PPF i.e. for 15 years, then according to the current interest rate, a total fund of Rs 40,68,209 can be raised.

Maximum deposit in a financial year: Rs 1.50 lakh

Interest rate: 7.1 percent per annum

Total deposit in 15 years: Rs 22,50,000

Total fund after 15 years: Rs 40,68,209

PPF: How to earn monthly income

Even after the maturity of PPF, you can extend it for 5 years or 5 years as many times as you want. Here you ran the scheme for 15 years and created a fund of Rs 40,68,209. Now if you extend it for 5 years without investing anything, you will get 7.1 percent interest on the closing balance. At the same time, you can withdraw any amount in one go in a year. Suppose you plan to withdraw only the interest money once in a year.

Here you will get 7.1 percent annual interest on your closing balance. This will be Rs 2,88,843 in a year. You can withdraw this entire interest amount in one go in a year. If you divide it in 12 months, it will be Rs 24,000 per month. At the same time, there will be no tax on this withdrawal.

How to open a PPF account?

Any Indian citizen can open this account in the Post Office Small Savings in his or his child’s name. Both offline and online processes are available for this. The documents required for this are:

KYC documents verifying a person’s identity, such as Aadhaar card, voter ID card, driving license etc.

PAN card

Address proof

Form for declaration of nominee

Passport size photo

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