PPF deposits have a lock-in period of 15 years. Whereas your investment in mutual funds (open-ended) can be redeemed on any business day. The flexibility of redeeming your funds as per the requirement makes mutual funds investment much more liquid than PPF deposits.
Which is better investment PPF or SIP?
When it comes to analysing both these options based on returns, you will find that PPF offers you a rate of interest of 7.6% per annum. However, SIPs offer you a higher return as the average interest rate ranges between 12% and 15%, and can go up to 21% under pleasant market conditions.
How much should I invest in PPF and mutual fund?
Furthermore, the minimum investment in PPF account is Rs. 500 and maximum is Rs. 1,50,000. Investments can be made in lump sum or in a maximum of 12 installments. Deposits into a PPF account have to be made at least once a year for 15 years.
Is anything better than PPF?
After PPF, ELSS is one of the most tax friendly 80C investment options. ELSS capital gains of up to Rs 1 lakh in a financial year are tax free. Capital gains in excess of Rs 1 lakh are taxed at 10%.