No doubt, we all want a life for ourselves and our loved ones that is secure and settled. For this, the first thing that we start with is financial planning for the coming years. We take into consideration the rising inflation rates and our long team goals as well.
However, we often face hassles while planning for the future. With numerous ways available, we sometimes get confused about which one to go with. Investing in an investment plan in India is one of the best ways to provide financial security to yourself and your loved ones. With this, we know that we will have an ideal amount of money that will provide financial security in hard times and ensure that we are able to fight the rising cost of inflation rates as well.
One of the best investment plans in today’s time is the Public Provident Fund or PPF account in the post office. Talking about PPF accounts in post office, we often have numerous questions popping into our heads, such as what is PPO, what are its benefits and features and whether it will provide the financial security I am looking for. So, if you are looking for answers to the questions mentioned above, you have stumbled upon the right article. Here, we will look at everything about the PPF account in the post office and why it is a good investment plan.
Let us start by understanding what a PPF account in the post office.
What is a PPF Account in Post Office?
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- The Public Provident Fund or PPF account in the post office is an investment plan that provides financial security to you and your loved ones. In case the policyholder comes across an unforeseen event, such as untimely demise, this plan will provide a lump sum amount of death benefits to the policyholder’s family. With this, his family can continue with their lives without having to face any financial hassles in the coming years and can achieve their dreams and goals seamlessly.
- The minimum tenure or lock-in period of the PPF account in the post office is 15 years. In case the policyholder comes across a financial hassle, he or she can withdraw a certain amount during the 7th year of the policy.
- After the completion of the tenure of the PPF plan, i.e. 15 years, you can either withdraw the entire amount or extend the policy’s tenure by 5 years.
Why Should You Open a PPF Account in Post Office?
A few reasons why you can consider opening a PPF account in the post office are as follows –
#1. Financial Security of You and Your Loved Ones
One of the prominent reasons you can consider investing in the post office PPF account is that it provides long-term financial security to you and your family. With this, you and your family do not have to worry about the financial aspect in the coming years. Moreover, this plan also provides a lump-sum amount of death benefits in case of unforeseen demise of the policyholder so that they can carry on with their lives even if you are not there to provide them with a financial backup.
#2. Tax Deduction Benefits
Another key reason why you should open a PPF account in the post office is tax deduction benefits. With this plan, you can claim up to Rs. 1.5 lakhs of tax deduction benefits in one financial year under Section 80C of the Income Tax Act, 1961.
Let us now look at the steps to follow while opening a PPF account in the post office.
How to Open a PPF Account in Post Office?
Step 1 – You will have to get a PPF account application form from your nearest bank branch. You can also avail of this form online.
Step 2 – Next, you will have to fill in your personal details along with KYC documents and your passport size photograph.
Step 3 – After this, you will have to deposit the initial amount in order to open your PPF account. The initial deposit can range from a minimum amount of Rs. 500 to a maximum amount of Rs. 1.5 lakhs in one financial year.
Step 4 – Your application will then get processed, after which you will receive a passbook for your PPF account.
Make the Right Choice
You now know everything about the PPF account in the post office, its benefits, and the steps to follow to open this account. While planning to invest in a PPF investment plan, make sure that you choose a leading and reliable insurance company as they provide the best PPF plans and their experts who will guide you on your way forward.
