How can a PPF calculator help you?
A Public Provident Fund calculator is a financial tool that helps you calculate the returns on your Public Provident Fund (PPF) investments. It allows you to determine the maturity amount of your investment, the total interest earned, and the total amount of savings accumulated over a specified period of time. By using a PPF calculator, you can make informed decisions about your investments and plan your finances better.
The calculator automatically applies the latest current PPF rate of interest offered by the government of India, making your experience seamless and hassle free!
Formula used for calculating PPF
The formula used to calculate the maturity amount of a Public Provident Fund (PPF) takes into account:
Variable |
Description |
F |
Maturity of PPF |
P |
Annual installments |
I |
Rate of interest |
N |
Total number of years |
Simplified formula: F = P[({(1+i)^n}-1)/i]
Explanation:
- This formula essentially calculates compound interest. Your annual contribution (P) earns interest, and that interest is reinvested to earn even more interest over time.
- The interest rate (r) changes annually, so calculations adjust accordingly.
Example:
Assume you invest Rs. 1,50,000 annually (P) in your PPF account for 15 years (n). The current interest rate (r) is 7.1%.
- Calculation would be a bit complex, as the interest rate (r) would change each year.
- However, using an online PPF calculator, we find the approximate maturity value would be around Rs. 40,68,209. This includes both your principal contribution and the accumulated interest.
PPF calculation examples for different investment tenures
Let’s understand this with an example
Assuming a 7.1% interest rate, investing Rs. 1.5 lakh annually for 15 years can yield a maturity value of approximately Rs. 40.68 lakh.
Remember:
- Interest rates can fluctuate.
- Early withdrawal is possible but discouraged.
- Consult a financial advisor for personalized advice.
Investment period |
Yearly investment |
Total interest earned |
Maturity value |
15 years |
Rs. 1.5 Lakh |
Rs. 16,94,599 |
Rs. 39,44,599 |
20 years |
Rs. 1 Lakh |
Rs. 23,03,987 |
Rs. 43,03,987 |
30 years |
Rs. 75,000 |
Rs. 52,40,722 |
Rs. 74,90,722 |
How to use PPF calculator?
Using the Bajaj Finance PPF calculator is quite simple, just follow the below mentioned steps and you will be able to calculate your potential PPF returns in no time:
- Yearly investment: Input your “Yearly Investment (in rupees)” in the provided field.
- Tenure selection: Specify the “Tenure (in years)” in the designated space.
- Interest rate retrieval: The calculator will automatically retrieve the “Rate of Interest.”
- Payout frequency: Choose your preferred "Payout Frequency" from options like Monthly, Quarterly, Half-Yearly, and Yearly.
- Maturity and interest calculation: View the calculated "Maturity Amount," "Total Investment," and "Total Interest."
- Calculate returns: For further details, explore the "Calculate Returns" section.
Advantages of using PPF calculator
The advantages of using a PPF calculator are as follows:
- Financial planning: By using an online PPF calculator, you can get a clear idea of how much interest you can earn with a certain amount of money.
- Time-saving: It saves time and effort by automatically inputting the current rate of interest, and automating the calculation process.
- Accuracy: You can use PPF interest rate calculator to get an estimate of the total returns, just by entering a few values like, yearly investment amount, tenure, and the payout frequency.
- Flexibility: You can use the Public provident fund calculator over and over again until you strike a balance between how much you must invest to get the desired returns.
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