How To Be A Crorepati With This Provident Fund Investment?

Private sector employees usually do not get a pension post-retirement and thus look for plans that offer them great benefits. In this article, we are going to talk about a Provident Fund investment scheme through which can make a salaried person crorepati. Anyone aged 21 and has a basic salary of Rs.25,000 per month can go ahead with this scheme.

The Right Provident Fund Investment

How To Be A Crorepati With This Provident Fund Investment?

The Employees’ Provident Fund Organization offers various schemes and plans to private sector employees. It is considered one of the prominently undertaken plans when it comes to safeguarding life after retirement. EPF investment up to ₹ 1.5 lakh per annum qualifies for tax exemption under Section 80C of the Income Tax Act. The maturity amount requires no tax once an employee continues for more than five years. A person, aged 21 with a basic monthly salary and DA (Dearness Allowance) of ₹ 25,000 can retire with over ₹ 1 crore from his regular contributions to the EPF investment.

As per the current EPFO rules, the employee and employer contribute 12 percent of the basic salary and dearness allowance (DA) each towards EPF. The amount added to the retirement plan gets deducted from the monthly salary of an employee. If we talk about the contribution of the employer,8.33 percent goes towards the Employee’s Pension Scheme, and only 3.67% will go towards EPF investment.

Also read,

Latest LIC Policy Offers Benefits Worth ₹22 Lakh On Maturity

Interest Rate on EPF

As per the government, the interest rate on the Employees’ Provident Fund is at 8.1 percent for the Financial Year 2022-23. An individual who never withdraws money from the EPF account at the current interest rate can retire with more than a crore in their provident fund. Consider that your retirement age is 60 and you are contributing for 39 years at the current interest rate of 8.1 percent, your account will have around 1.35 crores once you retire. It is worth noting that with an annual increment of 10 percent in the salary, one can retire with an EPF corpus of over Rs.6 crores. The EPF investment calculations are affected by the basic salary, DA, and interest rates. The interest rate on EPF investment is changed from time to time by the government.

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Maanik Suri

I'm perpetually hungry for writing. From rib-tickling memes to earthshaking pieces, I cover everything. Here to make the web a more bright space! :)

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