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Got Job Government Job at 20 years of age nice but is that can fulfil all your dreams? You may have social respect in society, but is that give you the freedom to go anywhere or can do anything you wishes in life.
PPF a brief History
PPF is one of best safe investment of Govt of India with annual interest 7.1%
Let us assume you are very careful of your future and don’t want to take much risk of your money and put 1.5 lakhs every year in PPF/PF account for an extended period of 25 years.
Your Total Investment will be
₹3,750,000
Total Interest
₹6,558,015
Maturity Value ₹10,308,015
So, in short, suppose you got a job on 2021 at the age of 20 say and keep investing in PPF up to your age 45 you will get 1crore plus in PPF assuming rates of interest will not fall further.
Is the money 1 crore enough in 2065 started in 2021 invested 1.5lac everymonth ?
If your answer yes they you need not read this part if no read this carefully.
Equity Direct investment not Mutual Fund
Suppose you started same investment 1.5lakh (monthly investment 12500 INR) in Equity from 2021 at good Scripts and can generate a yearly return 25% only which is not a big thing in the equity market.
Total Investment
₹3,750,000
Est. Returns
₹293,186,770
Total Value ₹296,936,770
So at the age of 45 you will have a capital 30 crore approx
What will happen if suppose you cant generate 25% yearly in a direct equity fund?
In the worse case suppose you not able to generate 25% you will be still in between 15% to 25% at least but if you can generate more then 25% then?
So every step is very crucial while taking financial descisions.
You will do 9 to 5 Job every day in your office, but one person without doing anything can beat your earnings by thirty-plus maybe thousands of crores.
Whichever is more Risky ?
So final conclusion whichever is more risky equity Fund of so called safe FD/PPF
Choice is yours.
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Nice article.