Many schemes have been designed for retirement, Public Provident Fund (PPF) is also one of them. This scheme is very good in terms of adding big money in the long term. You can deposit a minimum of 500 and a maximum of 1.5 lakh rupees every year in PPF. But if you want, you can earn interest through PPF without contribution, that too in lakhs. Even big experts will hardly be able to tell you this way of earning interest on PPF. Know how this will work.

You can deposit a maximum of 1.5 lakh rupees in PPF in a year. At present, this scheme is getting an interest of 7.1% and this interest increases based on compounding. The maturity period of PPF is 15 years, but you have to extend it twice in blocks of 5 years each and continue the investment. This means you have to deposit Rs 1.5 lakh annually for 25 years.

When you invest Rs 1.5 lakh annually in PPF for 25 years, your total investment will be Rs 37,50,000 and you will get an interest of Rs 65,58,015 at the rate of 7.1 percent. In this way, you will have a total of Rs 1,03,08,015 in your PPF account.

You do not have to withdraw this money from the account even after 25 years. If you do this, then whatever amount is deposited in your PPF account, it keeps earning interest as per the calculation of PPF. Since your account has matured, you can withdraw the entire amount from this account anytime or let it remain deposited and earn interest on the deposit.

If you keep the entire Rs 1,03,08,015 in the account, then at the rate of 7.1%, you will earn Rs 7,31,869 as interest. In this way, without contribution, you can earn lakhs of rupees every year from interest. As long as this money is deposited, you will keep getting interest on it.

Let us tell you that to extend the PPF account with contribution in blocks of 5 years each, you will have to submit an application to the bank or post office, wherever you have the account. You will have to submit this application before the completion of 1 year from the date of maturity. Keep this in mind especially to continue contribution in PPF account for 25 years.