00:00Due to the storm in the share market, the systematic investment plan, i.e. SIP, has increased rapidly.
00:08This is why in August, the mutual fund industry invested more than Rs. 1 lakh crore.
00:15Because of the explosive return, the investors like SIP, but for a secure and guaranteed return,
00:22the public provident fund, i.e. PPF, is still in force.
00:26Namaskar, I am Digvijay Singh, and you are welcome to GoodReturns.
00:31In terms of investment, both SIP and PPF are popular investment tools.
00:36So, let us first understand what PPF and SIP are, and from the calculation we will understand
00:41who is more important in terms of return.
00:45Systematic investment plan, i.e. SIP, invests money in the mutual fund.
00:51However, SIP is a high-risk investment tool, in which the return depends on the movement of the share market.
00:58It is believed that an investor in SIP can get a return of up to 12% on average.
01:04Now, if we talk about PPF, then this is a government saving scheme, which matures in 15 years.
01:10In this, an investor gets an annual interest rate of 7.1%.
01:15It should be noted that in PPF, an investment of up to Rs. 1.5 lakh and at least Rs. 500 can be made during one financial year.
01:26In this scheme, investors also get the benefit of tax exemption.
01:30As far as the best option for return is concerned, let us understand this from the calculation.
01:34If an investor invests Rs. 5000 per month in PPF, then an annual investment of Rs. 60,000 is made.
01:43If the investment is continued for 15 years, the total amount deposited in the account will be Rs. 9 lakh.
01:49According to the annual interest rate of 7.1%, an investor will get a return of only Rs. 7,27,284 in 15 years.
02:00That is, an investor will get a total of Rs. 16,27,284 on maturity.
02:07If an investor invests Rs. 5000 per month in SIP and continues it for 15 years, the total amount deposited in the account will be Rs. 9 lakh.
02:17According to the annual interest rate of 7.1%, an investor will get a return of Rs. 25,22,880 on maturity.
02:29That is, an investor will get a total of Rs. 16,22,880 on maturity.
02:36According to the calculation figures, an investor gets the highest return in SIP, which is a high-risk investment tool.
02:45In PPF, under Section 80C of the Income Tax Act, an annual tax exemption of up to Rs. 1.5 lakh is given.
02:56Also, there is a guaranteed return on investment.
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