1. What is a PPF Rate Of Interest Calculator?

Definition: This calculator computes the interest earned on a Public Provident Fund (PPF) account based on the account balance and current interest rate.

Purpose: It helps investors estimate their PPF account earnings and plan their long-term savings strategy.

2. How Does the Calculator Work?

The calculator uses the formula:

Where:

• \( I \) — Interest earned ($)
• \( B \) — Account balance ($)
• \( r \) — Interest rate (in decimal form, e.g., 7.1% = 0.071)

Explanation: The account balance is multiplied by the interest rate (converted from percentage to decimal) to calculate the interest earned.

3. Importance of PPF Interest Calculation

Details: Accurate interest calculation helps in financial planning, tax estimation, and comparing investment options.

4. Using the Calculator

Tips: Enter your current PPF account balance and the current interest rate (default 7.1%). All values must be > 0.

5. Frequently Asked Questions (FAQ)

Q1: How often is PPF interest calculated?
A: Interest is calculated monthly but credited annually at the end of each financial year.

Q2: What's the current PPF interest rate?
A: As of 2023, it's typically 7.1% but check with your bank for current rates.

Q3: Is PPF interest compounded?
A: Yes, PPF interest is compounded annually.

Q4: Is PPF interest taxable?
A: No, PPF interest is completely tax-free under Section 10 of the Income Tax Act.

Q5: Can I change the interest rate during the year?
A: No, the rate is fixed by the government and changes are announced quarterly.