How is PF calculated in retirement?

How is PF calculated in retirement?

Corpus for Retirement: A minimum contribution of an employee towards the EPF scheme is 12%. Hence every employee earning over Rs. 5000 or more every month is required to pay 12% of his/her salary towards the EPF Scheme.

Which is better PF or PPF?

The current EPF rate is 8.50% while the current PPF rate is 7.1%. Historically as well, the EPF rate has been slightly higher (8.65%) than the current rate FY 2020-21 and the current PPF rate. However, the equity exposure in the EPF makes it vulnerable to market movements.

What is the lock in period for PPF?

While the lock-in period in PPF is 15 years, it provides liquidity in the form of loan and partial withdrawals. Loans against the PPF account are available after 3 years from opening an account and the partial withdrawal facility is available after 6 years of the account opening.

Can I opt out from PF?

If your basic monthly salary is over Rs. 15,000, you can opt out of your EPF contributions if you want to (although it isn’t recommended that you do this). Persons who opt out of the EPF contributions will get all their salary in hand with no deductions towards provident fund.

Is there any time limit for PF transfer?

The time period taken to transfer the PF account is around 20 days. It can increase or decrease depending on the time taken by the previous employer to attest the old claim.

Is PF transfer automatic?

There would not be any hassle of EPF transfer. The whole process has become automatic and you don’t even need to apply, online or offline. Till now, you have to initiate EPF transfer either through the UAN portal or through the employer.

How is PF interest paid?

While the EPF contribution is deposited every month, the interest is calculated at the end of the year. EPFO calculates monthly closing balance every month and then the interest is calculated. The interest is calculated by multiplying the monthly balance with interest rate.

Is EPF interest compounded monthly?

EPF Interest is compounded monthly and is credited at the end of the financial year.