A Provident Fund (PF) is one of the most favored instruments for investors. This is because the interest earned is guaranteed as it is a government initiative, and under Section 80C of the Income Tax Act, you can claim tax benefits on the amount invested as well. Moreover, you can open an account under this scheme at any bank or post office to accumulate a pool of funds over a long tenor of 15 years.
How to Grow your PF Money Grow?
After the maturity of your Provident fund (PF), you can also extend your investment indefinitely, 5 years at a time. Subsequently, you can also consider starting a senior citizen FD to grow your corpus in a smart and safe manner.
This is just one way of putting your PF amount to good use, and you may wonder if you should invest in the stock market or in a fixed deposit. The solution to this is to assess your risk appetite as the stock market is volatile and carries high risk whereas with a senior citizen fixed deposit scheme offers assured, high fixed deposit interest rates and is completely risk-free. Conversely, you can look to invest your corpus into other financial instruments altogether in line with your financial goals.
Here are some of the safest investment options for retirement where you can invest your PF money after maturity to earn lucrative returns.
Senior Citizen Fixed Deposit
Senior citizen fixed deposits are good saving instruments as they are ideal for the risk-averse investor and offer guaranteed returns. When you choose a Senior Citizen Fixed Deposit from Bajaj Finance you can earn higher senior citizen interest rates of up to 9.10% with a cumulative FD of at least 36 months, as opposed to a regular cumulative FD of the same duration which offers 8.75% as interest.
Also, if you seek a regular payout you can choose a non-cumulative fixed deposit. Then select the frequency at which you want to receive returns. This can be monthly, quarterly, half-yearly or annually.
Debt Mutual Funds
When you choose debt mutual funds you can invest in fixed income securities such as corporate and government bonds, Money Grow market instruments and other corporate debt securities that will help grow your capital. Consider these options while investing your PPF amount as they have a short lock-in period of up to 3 years and typically yield high returns. Besides, they have high liquidity and carry low risk too.
Tax-free Bonds
Bonds that are issued by government organizations such as the Indian Railway Finance Corporation, National Highway Authorities of India and others are another excellent option. They offer returns around the 8% mark and have a long maturity period, typically 10 to 20 years. As they are offered by the government they are completely safe, and as the name suggests, they offer significant tax benefits too.
Therefore, instead of shifting your PPF maturity amount into a savings account that carries a low-interest rate, choose these high-interest investment instruments and grow your Money Grow further.
