This holds true for investing in the Public Provident Fund (PPF) too. By depositing ₹1.5 lakh between April 1 and April 5, you can maximise the return on your investment.
"A lump sum deposit made before April 5 will allow you to earn a higher amount of interest income, which, with compounding, will snowball into a larger corpus than if you invest the money monthly and after the 5th of each month," says Adhil Shetty, chief executive officer (CEO), Bankbazaar.com. Money can be deposited in PPF in any manner: monthly, quarterly, or one-time lump sum.
"If one investor invests a lumpsum amount of ₹1.5 lakh before April 5, over 15 years she would earn around ₹2.5 lakh more than another investor who invests lump-sum or monthly after April 5," says Jay Thacker, member, Association of Registered Investment Advisors (ARIA).
Why invest before the 5th
Even though the total interest is deposited in your PPF account at the end of the financial year, the interest is calculated for each month.
The interest calculation is done on the lowest balance in the account between the 5th and the last day of each month.
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Denne historien er fra April 03, 2024-utgaven av Business Standard.
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