PPF (Public Provident Fund) is the most preferred investment in terms of tax benefits, interest and retirement planning. It has always been an attraction among investors because of the sovereign guarantee and interest rates higher than the current FD rate. Even though PPF
Comes in EEE (Exempt, Exempt, Exempt) category but its lock-in period is the highest among tax saving instruments.
Loan starts getting after PPF account opening
PPF has a lock-in period of 15 years but you can take a loan instead and make partial withdrawals. Loan is available only after 3 years of opening PPF account. Some amount can also be withdrawn after 6 years of opening the account. After the initial investment of 15 years, it can be invested for another 5 years. There is also no restriction on further account extend. You can also extend the account without investment.
Can the nominee continue the contribution after the death of the PPF account holder?
Sudhakar Sethuraman, Partner, Deloitte India, says that the nominee cannot continue this account after the death of the PPF account holder. He has to withdraw money by filling Form G. If there is no nominee then the legal heir will have the right over it. However, succession certificate is not required for the amount less than one lakh rupees.
Mutual Fund Investment: Know these 5 important things before investing in mutual funds, they will be in profit
Will the nominee have to wait for the money because of the lock-in period?
If the account holder dies within five years of opening the PPF account. So the nominee will not have to wait another ten years to get the money. After the submission of Form G and successful verification towards the respective offices, the amount will be deposited in the account of the nominee. The account holder will continue to get interest till the last month for which the money has been deposited in it. Nominee cannot deposit money in this PPF account.
(Article: Amitava Chakrbarty)