Investing in PPF scheme can be beneficial to meet the expenses from the child’s education to other expenses. Good amount can be added till the child attains adulthood.
From the very beginning, investment of parents in the right scheme is necessary to take responsibility for the expenses of the child from his education to his marriage. From this, a good amount can be added till the minor attains adulthood. In such a case, Public Provident Fund (PPF Account) is a better option. In this, an account can be opened with an investment of only 500 rupees. The maturity period of this scheme is 15 years, but if you want, you can promote it for 5-5 years. In this, returns are given in lakhs on long-term investment.
If you open a PPF account in the name of the child, then tax exemption is also available. You can open an account directly in the child’s name. However, the guardian will have to operate the account till he attains the age of 18 years. Later the child can take care of it himself. This fund can be used to build higher education or own business.
How to open an account
PPF account can be opened in any bank or post office. However, according to the rules, a person can open only one account in his name. If you want to open your child’s account, an account can be opened in his or her name. Those who have two children can open one account in the name of the mother and the other in the name of the father. But the parents of both the children cannot be named together. If a PPF account is also opened in the name of a parent, then together with both accounts, you can deposit a maximum amount of 1.5 lakhs per annum. In this, the minimum amount to open an account is 500 rupees.
Benefits of PPF Account
Minor PPF account provides loan facility. Apart from this, you can partially withdraw money as needed. While taking this facility, the guardian will have to give the declaration that the money being withdrawn is being withdrawn only for the minor. Apart from this, if the child’s name is also deposited in the PPF account, then even ten will get the benefit of tax exemption under Section 80C of the Income Tax Act.
Millions will be available on maturity
According to the PPF calculator, if a person deposits one and a half lakh rupees every year in the name of a child, it attracts compounding interest of 7.1 per cent per annum. So after 15 years, you will get 40,68,209 rupees on maturity. So your total deposit investment is 22,50,000. In this, you will get the benefit of interest of Rs 18,18,209.
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Buy this special scheme of LIC at the time of childbirth, by the age of 25 your ladla will become a millionaire, know the specialty