How to open a PPF Account, an investment option that may well be the best one for you?
Know here that this is one of the best savings and investment tools a person looking to retire rich can have at the moment. PPF stands for Public Provident Fund and is one of the few investment plans that offer an EEE (Exempt-Exempt-Exempt) status in terms of exemption. What does that mean? There are 3 stages of investment - Investment Stage, accumulation stage and withdrawal stage. PPF is EEE means it is tax exempt at each stage. It is one of the most respected long-term investment options that is offered and backed the Central Government. It is today the most popular investment made by citizens. So, if you are keen on a safe investment, a decent rate of return, tax benefits (deduction and tax free interest) and have a long term investment horizon, then PPF is for you as well as your family members. Of course, one thing investors should know is that their money is blocked for 15 years. However, this is also what makes it a disciplined investment avenue.
PPF account can be opened at banks, however not every lender provides the facility of PPF accounts. One can easily get a list of eligible bank on various websites or details at any respective branch. Image source: Reuters
How to open a PPF Account?
List of documents required to submit:
1. PPF Account opening form is easily available at the designated bank branch or at the Indian Post portal in case you want to open it at a post office.
2. ID proof that can be any of the following: PAN card or Driving license or Voter ID card or Passport. Image source: Reuters
3. For online applications, different banks have different kind of processes, but the basic documentation and submission of application, remains the same.
4. Address proof, which can be any of the following: Telephone bill or Electricity bill or Ration card
5. Two current passport size photographs
6. Pay-in slip, which will be available at the bank branch to transfer amount to your PPF account. Image source: Pixabay
Points to note down while opening a PPF Account
1. Carry all the original documents to the bank for quick and convenient verification
2. All the documents must be self-attested by the applicant. Image source: Pixabay
3. A PPF account passbook resembling a bank passbook is issued to the applicant once the account is opened. All transactions in the PPF account are updated in this passbook. The passbook is requirement in order to claim tax deduction under Section 80-C of the Income Tax Act. Image source: Pixabay
4. An important thing to remember is that the payee name should match the name as mentioned in the PPF account passbook. Image source: Pixabay
5. Opening a PPF account at a bank is far more convenient than opening one at a post office. The bank offers online fund transfer from the individual's savings account to their PPF account. Image source: Pixabay