PPF stands for Public Provident Fund, which is a long-term savings and investment scheme offered by the Government of India. It is a popular investment option among individuals looking for a secure and tax-efficient way to save for their long-term financial goals.
A PPF calculator is an online tool that helps you estimate the investment value of your Public Provident Fund (PPF) investment over a certain time period. PPF is a government-backed savings scheme that comes with a 15-year lock-in and offers better returns than alternatives like a fixed deposit. PPF is also a great way to reduce your tax liability during your working life. A PPF account calculator can also help you plan for retirement. PPFs have a 15-year lock-in period, which means PPF can be a great way to take a disciplined approach to invest for retirement. If you already have a retirement corpus in mind, you can look at how much you'll need to invest over a certain period to achieve your retirement goal. However, note that the yearly contribution to a PPF account is capped at ₴1.5 lakh.
Using a calculator could help you plan your taxes because once you know how much you'll need to contribute annually, you'll also know how many deductions you can claim each year u/s 80C of the Income Tax Act, 1961. Also If you have a goal in mind, you car use the calculator to tweak the inputs to see how much you'll need to contribute annually to achieve your goal. Following is the PPF calculation formula that a PPF return calculator uses:
Where:
• M = Maturity Value
• P= Annual Payments
• i= Interest Rate
• n = Number of years