A better long-term investing alternative is Public Provident Fund. The money invested, the interest earned on it, and the amount received at the end of the maturity period are all tax-exempt in PPF when the appropriate interest is available. It is quite well-liked among investors as a result.15 years are required for PPF to mature. Some individuals believe that once money is invested, it cannot be withdrawn at any point. His presumption is wholly incorrect. Under some conditions, the PPF can be closed even before the end of the maturity term. Tell us how it works and under what circumstances money can be withdrawn in advance.
In these circumstances money can be withdrawn first.
Money from a PPF account can be withdrawn in the event that a spouse or kid becomes unwell. Additionally, account holders may withdraw the whole balance of their PPF account for their children's education. An account holder may close his PPF account even after becoming a Non-Resident Indian (NRI).
Money can be withdrawn only after 5 years.
Only after five years have passed since the account was first opened may any account holder close the PPF account. If the account is closed before the maturity period, 1% interest will be withheld from the account opening date until the account closing date. This five-year condition does not apply to the account holder's nominee if they pass away before the PPF account reaches maturity. Money may be withdrawn by the nominee prior to five years. After the account holder's passing, the account gets closed. The nominee is not permitted to carry on.
Account closure process.
Account holders must fill out a form and submit it to the post office or bank where they have a PPF account if they want to withdraw money before the maturity date. Both the original passbook and a photocopy of it are needed. The interest continues to accrue until the end of the month in which the PPF account is closed if the account holder's death caused the closure.
PPF interest rate.
The annual interest rate for PPF accounts is currently 7.1 percent. PPF deposits are limited to Rs. 1.5 lakh per fiscal year with a minimum of Rs. 500. One PPF account can be opened in a person's name only.