How to Calculate PPF Maturity Amount
PPF (Public Provident Fund) is a government-backed savings scheme in India with a 15-year lock-in period. It offers tax-free returns and is compounded annually.
PPF Maturity Formula (for annual deposits)
FV = P × [((1+r)^n - 1) / r]
Where:
- FV = Maturity value
- P = Annual deposit amount
- r = Annual interest rate (decimal)
- n = Number of years (minimum 15)
Step-by-Step:
- 1
Decide annual deposit
PPF allows ₹500 to ₹1.5 lakh per year.
- 2
Note current PPF rate
Check the current rate (revised quarterly by the government).
- 3
Apply the formula
Compound annually over the full tenure.
Worked Examples:
₹1.5 lakh annual for 15 years at 7.1%
Annual: ₹1,50,000Rate: 7.1%Tenure: 15 years
Result: ≈ ₹40,68,209
Invested: ₹22,50,000. Interest earned: ₹18,18,209. Total: ₹40,68,209.