How To Earn Rs 24,000 Per Month Pension? Here's The Trick And Calculation Behind Your Financial Flow

Public Provident Fund (PPF) is one of the most attractive financial instruments in our investment portfolio. It can work as a pension instrument provided you have a sizable balance. If you are looking for a safe and reliable investment tool to receive a decent monthly income post your retirement, PPF is a viable option for you. 

Your investment is locked for 15 years once you start the PPF. Once the PPF matures, you can close the account. The second option is to extend it for five years without contribution. The final option is to extend the PPF for 5 years with contributions. There is no limit on the number of times PPF users can extend their accounts in blocks of five years each. 

After the PPF account has completed 15 years and you decide to extend it by five years either with or without contribution then your PPF balance will continue to earn tax-free interest. The current PPF rates are 7.1 percent. 

Here are the specifics of the potential monthly income you could receive from investing Rs 12,500 per month in PPF. 

Monthly investment in PPF: Rs 12,500 Interest rate: 7.1% per annum Total contribution over 15 years: Rs 22,50,000 Total corpus after 15 years: Rs 40,68,209 Annual interest during extended period: Rs 2,88,842 Estimated monthly interest: Rs 24,070

You will receive an anticipated monthly interest of Rs 24,070 from a PPF investment with a monthly deposit of Rs 12,500. 

If you do not close your PPF account after 15 years and extend it by a couple of blocks of five additional years, you will end up with a significant corpus.