When it comes to the investment we are very picky and confused to conclude our choices. Most people choose government-backed low-risk and high returns offering savings schemes over mutual funds, debt funds, and direct equity investments. There are two of the most popular investment plans that the Indian Government offers- the Employee Provident Fund (EPF) and the Public Provident Fund (PPF). Both the schemes are top-tier wealth planning options but they come with their perks and quirks which a person should consider analyzing before registering. So, this article will help you understand which one is best for you EPF vs PPF.
EPF vs PPF, Which one to Choose?
EPF or Employee Provident Fund
Employee Provident Fund is a unique retirement planning savings scheme, which is linked to your salary to accumulate contributions. Investing in this scheme is mandatory for the employees and employers and accumulated funds are invested in Government approved funds. After maturity, the contributed amount and interest can be availed tax-free.
PPF or Public Provident Fund
PPF Scheme, managed by the Government of India, is a long-term savings plan for an individual to secure his or her future wealth. Investors get a tax-free interest rate of 8% annually. The amount invested is tax-free and the total amount availed after maturity is also tax-free. Funds invested in PPF are locked for 15 years and cannot be withdrawn without facing penalties.
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Which One is the Best Investment Option for You PPF vs EPF?
“Both EPF and PPF have their advantages and disadvantages. However, it is important to assess your individual needs and goals before making a decision. EPF is a safer option as it is backed by the government and offers a tax-free interest rate. The funds can also be withdrawn if required. On the other hand, PPF offers higher returns but has a lock-in period of 15 years,” mentioned newstrack live.
“If you are looking for a short-term investment option, then EPF is a better option. However, if you are looking for a long-term investment that offers capital appreciation and higher returns, then PPF is the right choice. You can also use a PPF Calculator Online to Calculate PPF returns accurately,” further mentioned.
“Overall, both EPF and PPF offer attractive investment options, and thus, it is important to assess your individual needs and goals before making a decision. Both options are safe and secure and it is up to the individual to make the right decision for their financial needs.”
