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Everyone wants a substantial bank balance when they retire or need a large sum of money in the future. Amidst the fluctuations of the stock market, PPF is a safe haven that not only provides guaranteed returns but also helps you save taxes. But did you know that simply depositing money in PPF isn't enough? If you adopt the right strategy, you can accumulate crores of rupees through this government scheme.

Let us know those 5 smart rules which can take your investment to new heights.

1. Mathematics of the 5th of the month

PPF interest is calculated on the minimum balance between the 5th and the last day of the month. This means that if you invest every month, deposit your installment before the 5th. If you deposit after the 5th, you will not receive that month's interest. This small precaution can make a difference of lakhs to your total returns year after year.

2. Extending the investment time horizon (15+5 rule)

The maturity period of PPF is 15 years. Many people withdraw their money as soon as 15 years are up, which can be a big mistake. The real secret to becoming a millionaire lies in compounding. After 15 years, you can extend your account as many times as you like in 5-year blocks. As you extend it to 25 or 30 years, the interest on the interest increases your money exponentially.

3. Use the maximum limit

Currently, the maximum amount that can be deposited in PPF in a financial year is ₹1.5 lakh. If your income allows, try to fully utilize this limit each year. If you deposit ₹1.5 lakh in lump sum at the beginning of the year, i.e. in April, you earn maximum interest on that amount throughout the year, which is more beneficial than depositing in installments.

4. Double benefit of tax exemption

PPF falls under the "EEE" category. This means that the investment amount, the interest earned, and the entire maturity amount are tax-free. This is ideal for those who want to protect their hard-earned money from tax deductions. You can also reinvest these savings to grow your wealth.

5. Avoid premature withdrawals

PPF is a long-term savings scheme. While it allows partial withdrawals, experts advise against withdrawals unless there's a major emergency. Withdrawing money mid-term disrupts the compounding cycle, setting back your goal of becoming a millionaire.

PPF isn't a get-rich-quick scheme; it's a test of your patience and discipline. If you start investing from a young age and follow these rules, your small savings will turn into a mountain of wealth over time.