CAN I Continue PPF After 15 Years
In this post, we will review if a user can continue a ppf account after 15 years. There has been over 150+ users asking me this question by email and by blog comments, if its feasible to continue PPF Account after 15 years. Hence I took up this post to make users aware as to continuing a ppf account after 15 years is worthwhile or not.
CAN I continue PPF Account After 15 years
Well, the math is simple, should you continue or not. Let’s take a simple example: If a user started ppf account on April 1st 2016 and at the age of 30, he / she will continue to invest in ppf account for the next 15 years. So ideally in the year 2032, the user can withdraw the money that is matured from ppf account and user would have attained the age of 46 at the time of maturity. However, the user would still have around 14 years of service left before retirement and hence still needs to save 1,50,000 INR as per Sec 80C to save tax every year for the next 14 years. Hence tax savings becomes mandatory for the next 14 years. In this case, the ppf account has matured and ready for withdrawal as per rules, unless the user is willing to close the account.
A smart advise is to keep the ppf account active since future investment is to be made due to tax saving needs for next 14 years. It is advised to keep the account under subscription as paying rather than making it non subscription. This provides multiple benefits and they are listed below
- PPF Account Contribution : Continuing a PPF Account after 15 years would be ideal since benefits are extended with the ppf subscription as continued and provides tax savings scheme active.
- PPF Account Continuation Form : Submitting a letter to extend ppf account helps a user to Extend the PPF Account by providing form h for ppf extension. Else the ppf account will remain in non -subscription mode and you can just reap the interest benefits.
- PPF Investment for Retirement : The best option available today for retirement planning is to have a PPF Account as the entire amount is tax free during withdrawal and the user can avail 100% of the full amount.
- Build Corps : The ppf account will yield better returns as the number of years of operating the account increases. This makes one math simple – A user can generate 1 Crore from ppf account within a span of 20+ years all tax free.
- PPF Retirement Planning : PPF benefits can be used for retirement purpose. Corps collected during the end of 15 years can be further invested and the return on investment grows by 8.7% every year and tax free.
- Withdrawal from PPF Account : Withdrawal from ppf can be done every year after 7th year. Hence it is a better ROI. Even without subscription your ppf account can generate 8.7% of amount from the balance amount which is again tax free. Also read >>>PPF Withdrawal Rules in SBI
- Ideal Investment Rule : With 1,50,000 INR investment every year. Your account generates around 46 Lac. Further every year the account provides a ROI of 4.6 Lac tax free amount. Which is around 38,000 INR every month.
Also Read >>> How to Save in PPF Account