PPF vs EPF: Which Scheme is Right for You?

Sowmiya Sriram
PPF vs EPF: Which Scheme is Right for You?
 For salaried individuals, EPF is a retirement benefit plan. In this scheme, both the employee contribute and the company give in. To go through life comfortably and stress-free, you should have money in your pocket as long as you live. Peace is necessary for life, and peace also requires financial self-sufficiency. So, whenever you start a job, start your retirement plan with it. Public Provident Fund (PPF) and Employees Provident Fund (EPF) are two schemes offered by the government. These are great ways to build retirement funds. For salaried individuals, EPF is a retirement benefit plan. Employees Provident Fund Organization (EPFO) administers this fund. Whereas, PPF is designed for financial security in old age for all individuals.
PPF vs EPF: Who can invest?

Only salaried individuals i.e. in the EPF scheme, salaried employees can invest. On the other hand, in a PPF scheme. any individual can start investing. On EPF, the annual interest rate is now 8.1 percent. At the same time, for the december quarter, the government has kept the interest rate at 7.1 percent for PPF.
PPF vs EPF: How much is the minimum investment?
You can open an account with PPF with a minimum of Rs 500. Whereas, in EPF, the contribution is 12% of the basic salary. In this, both the employee and the company contribute 12 percent. This amount can be withdrawn from EPF on retirement or leaving the company (resignation). Whereas, PPF has 15 years as lock period. This can be further extended in blocks of 5 years.
PPF vs EPF: Understand the tax rules
After 3 years you can get a loan in a PPF account. At the same time, loans can be availed from EPF accounts for special situations like medical emergencies, housing, child education, etc. Withdrawals in PPF are tax-free, whereas EPF withdrawals before 5 years are taxable. At the same time, under Section 80C of Income Tax, tax deductions can be claimed on investments up to Rs 1.50 lakh in PPF and EPF.

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