Be a Crorepati with ease: it only takes 5% deduction in your salary
(Last Updated On: August 28, 2019)
Secured way to be a millionaire – EPF
We all strive so hard to achieve our respective financial goals. How about if I present you a proposal of becoming a millionaire in the most secure, authentic and legal way!! No, we are not talking about share trading. Neither about bitcoins,mutual funds or any other thing which can risk your hard earned money. And how do you feel knowing that you have already walked the half path?? Yes, I am not kidding!! if you have already allowed deductions from your salary towards EPF (Employees’ Provident Fund). You are there on the right path! But if you have not started yet, its still not too late. Learn from us how
Your salary in hand comes net of EPF
Deductions from salary are difficult to accept and we tend to minimize them. One such deduction being EPF, usually witnessed in all salary slips and targeted the most to be reduced. We emphasise at lowering the deduction so as to have greater liquidity in hand. But, this one important deduction which you should never decrease can actually yield Rupees 2.5Cr (approx) by the time of retirement.
Contributions to the fund
Don’t be in doubt that how can a interest as low as 8.65% per annum fetch you such a huge amount its because of the other factors namely, constant addition to the fund per month and compounding benefits. You will feel good to know that you are not the only one who is saving for your future, in case of EPF contributions are made in equal proportion of 12% of Basic salary + DA by employee and employer (other conditions apply). Which means you are paying less and saving more!!
Change in job does not restricts your growth in EPF
Change of employment does not mandates you to withdraw your EPF account. Now you can raise request for transfer of balance to your new employer in form F-11(Composite Declaration Form) and submitting basic details with UAN (Universal account number of EPF) the complete process has been made online to facilitate ease of employees. This entitles you to enjoy benefit of compounding of interest without getting it started from the initial stage.
EPF is also Tax savy
EPF provides you tax benefits at all stages i.e. from the day you start making your first contribution tax advantage is available to you in form of section 80C. Contributions made by employer are not taxable in your hands and contributions made by you are eligible for deduction under limit of 1.5 lakhs as per section 80C of Income Tax Act 1961. Also if you withdraw the amount after the span of continuous 5 years services, interest earned and principal amount invested both are tax free in the hands of receiver.
0% Risk associated
EPF provides you returns with 0% risk factor (as it is maintained under the administrative control of Ministry of Labour and Employment, Government of India through EPFO (Employees Provident Fund organisation) governed by Employees’ Provident Fund and Miscellaneous Provisions Act, 1952) ,
An investment which can make you crorepati is actually risk free – what more an investor seek for!!
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