PPF Vs Mutual Fund: Savings are necessary to create wealth, but without proper investment, savings are also of no use. Investing well can make you a millionaire in a few years…
To make the future safe and free from troubles, it is necessary to save. However, just saving is not enough. It is more important to invest the savings money well to create a big fund with time, otherwise the value of your saved money gradually decreases. If you invest your saved money properly, then you can become a millionaire in a few years.
Actually the goals of life of different people are different, but the big goals of life whether it is buying a house or children’s education, buying a new car or planning for retirement… It is necessary to have good funds. However, according to different goals, the ways of investing and saving people change.
Many people want maximum returns and do not care about the risk. At the same time, there are some people for whom risk is a big factor and such people prefer safe mediums even after low returns.
Be it any of these categories, you have the option of creating a fund worth crores. Yes, just the time it takes can be more or less. Talking about each and every example of both methods, mutual funds are preferred by people in terms of giving more returns, then PPF is one of the best options among safe means. Let us know what is the difference between these two, which of the two is more beneficial and with which scheme you can become a millionaire quickly…
Public provident fund
Apart from helping in saving for the future, it also helps in saving tax. Investors of PPF get interest on the deposit and there is no tax on the interest earned. Some of the advantages of PPF scheme are as follows:
- Tax exemption under section 80C
- Facility to deposit Rs.500 also
- Fixed income from interest
Mutual fund
In this, the investor puts his money, which is managed by professional people. Professional people invest the money of all the investors of the scheme in many places according to their own. Here are the advantages of investing in mutual funds:
More returns
- Funds are professionally managed
- SIP as well as Lump Sump options
- Facility to start with small amount
Now suppose one thing that you want to become a millionaire by investing Rs 10,000 every month i.e. around Rs 330 daily. Let us first understand this in the case of PPF. PPF is currently getting interest at the rate of 7.1 percent. The returns on PPF keep on fluctuating. Still, let’s assume that the average interest remains 7.5 percent. In this situation it will take you 27 years to become a millionaire.
In the case of mutual funds, 10-12 per cent returns are easily available. It also gives the benefit of compounding. Here if you invest Rs 10,000 every month and assume 12% return, you will become a millionaire in 20-21 years. It is worth noting that not only can it make you a millionaire before PPF, but the principal amount of investment in it is also less.
