Investing small amounts regularly can create big savings over time. This is possible because of the power of compounding. In India, one of the most trusted and safe long-term saving options is the Public Provident Fund (PPF). It is backed by the government, offers good returns, and also gives tax benefits.
If you invest ₹62,000 every year in SBI PPF for 15 years, your savings can grow to around ₹16.8 lakh. Let’s understand how this happens in simple steps.
Understanding SBI Public Provident Fund
The Public Provident Fund is a government savings scheme. It is made for people who want to save money safely and earn steady returns for the long term. SBI, being one of India’s largest banks, allows people to open and manage PPF accounts easily.
The lock-in period is 15 years, which means your money stays invested for that time. After 15 years, you can extend it in blocks of 5 years.
The interest rate is fixed and compounded yearly. The government reviews this rate every three months. Usually, it stays between 7% and 8%. The best part is that both interest and maturity amount are completely tax-free. Deposits also qualify for Section 80C tax deductions, making it a very tax-friendly plan.
Why Choose ₹62,000 as Your Annual Investment?
You can invest as little as ₹500 per year and as much as ₹1.5 lakh per year in PPF. Choosing ₹62,000 annually is a balanced choice.
It is big enough to build good wealth over time but still easy for many working people to manage.
If you put ₹62,000 every year for 15 years, your total deposits will be ₹9,30,000. But with compounding, the final amount will be much higher.
How Compounding Grows Your PPF Investment
The real strength of PPF is compounding. In compounding, you earn interest not only on the money you put but also on the interest you already earned.
- In the first year, you get interest only on ₹62,000.
- In the second year, you get interest on ₹62,000 + first year’s interest.
- From the third year onwards, the calculation keeps adding deposits and past interest.
This cycle continues every year, which helps your savings grow faster and bigger.
Example of Investment Growth
Here is a simple example of how ₹62,000 annual deposits can grow in 15 years at an average interest rate of around 7.1%:
| Year | Annual Deposit (₹) | Total Deposit (₹) | Estimated Value (₹) |
| 1 | 62,000 | 62,000 | 66,400 |
| 5 | 3,10,000 | 3,10,000 | 3,77,000 |
| 10 | 6,20,000 | 6,20,000 | 8,84,000 |
| 15 | 9,30,000 | 9,30,000 | 16,80,000 |
(Values are approximate for learning purposes)
Extra Benefits of SBI PPF
PPF is not just about safe returns. It has many other benefits:
- You get tax savings under Section 80C.
- Both interest and maturity amount are tax-free.
- It is risk-free because the government backs it.
- You can make partial withdrawals after 5 years.
- You can take loans from the 3rd to 6th year.
- After 15 years, you can extend the account in 5-year blocks.
Why Choose SBI for PPF?
SBI is one of the most trusted banks in India. It has branches all across the country and also offers easy online services.
You can open and manage your PPF account easily at SBI. The bank’s reliability and simple process make it a preferred choice for many people.
Conclusion
If you invest ₹62,000 every year in SBI PPF for 15 years, you can grow your money to around ₹16.8 lakh. This growth is due to compound interest and regular disciplined saving.
SBI PPF is a safe, tax-saving, and reliable way to build a solid future fund. Whether it is for retirement, your children’s education, or other life goals, this plan can help you.
Starting early and staying consistent is the key. For anyone looking for safety, guaranteed returns, and tax benefits, SBI PPF is one of the best choices.
Disclaimer: This is only for education. Interest rates may change. Always check with a financial expert before investing.
FAQs
How many years is PPF lock-in?
15 years.
What is the minimum deposit in PPF?
₹500 per year.
Is PPF interest tax-free?
Yes.
Can I extend PPF after 15 years?
Yes, in 5-year blocks.
Yes, in 5-year blocks.
Can I take a loan on PPF?