PPF Calculator

How the maturity value is calculated

The tool takes your yearly deposit, the interest rate and the number of years. For each year it adds the deposit and then applies a full year of interest: balance = (balance + deposit) × (1 + rate). In effect, every deposit is treated as made at the start of the year.

Worked example

Depositing Rs. 1,50,000 a year for 15 years at 7.1% gives about Rs. 40,68,209, from total deposits of Rs. 22,50,000. Rs. 1.5 lakh is the maximum that can be deposited in a PPF account in a financial year.

Differences from a real PPF account

• Interest timing: actual PPF interest is calculated on the lowest balance between the 5th and the end of each month, so money deposited after the 5th earns nothing for that month. Depositing before the 5th of April, or in one lump sum, matches this calculator best.
• The rate changes. The government resets it every quarter, so 7.1% is an assumption for the whole term.
• Extensions: the standard term is 15 years, and the account can be extended in blocks of 5 years. The tool will accept other durations but does not model extension rules.

PPF interest and maturity are tax-free in India, which makes it useful to compare against a taxable fixed deposit.

How to use the calculator

1. Enter the amount you plan to deposit each year. The upper limit for a PPF account is Rs. 1.5 lakh per financial year, and the minimum is Rs. 500.
2. Enter the interest rate. Check the current quarterly rate on the India Post or your bank's PPF page; the default is only a starting assumption.
3. Enter the number of years. Fifteen is the standard lock-in; try 20 or 25 to see the effect of extending in 5-year blocks.
4. Read the maturity value, the total you deposited and the interest earned. The gap between the last two is the benefit of compounding.

Why the early years matter most

Because interest compounds, a deposit made in year one earns interest for all fifteen years, while one made in year fifteen earns for only one. In the example above, roughly Rs. 18 lakh of the Rs. 40.7 lakh maturity value is interest, and most of that interest is earned in the second half of the term. Depositing the full amount early in each year, rather than spreading it over twelve monthly instalments, gives a slightly higher result for the same total.

Withdrawals and loans

PPF has a 15-year lock-in, but the rules allow a partial withdrawal from the seventh financial year onward, limited to a share of the balance from four years earlier, and a loan against the balance in the early years. The calculator does not model these. If you plan to withdraw before maturity, treat its figure as an upper bound and confirm the exact limits with your bank or post office.

PPF compared with other options

PPF is a low-risk, government-backed product with tax-free returns, so it suits the safe part of a long-term plan. It does not suit short goals because of the lock-in. For higher growth with market risk, compare it with the SIP calculator, and for salaried retirement savings see the EPF calculator. Tax rules and the rate can change, so verify them with an official source before you decide.

Frequently asked questions

Can I deposit more than Rs. 1.5 lakh? You can, but the excess earns no interest and is not eligible for deduction, so the calculator caps your sensible input at the limit.

Is the calculator result guaranteed? No. The rate is reset every quarter, so the real maturity value can be higher or lower than the figure shown.

Does the result include tax? No tax is deducted because PPF interest and maturity are exempt, so the figure shown is the amount you would receive.