FD vs PPF: People who save money usually choose such options for investment, where they get returns, and money is also safe. Anyway, there is a lot of turmoil in the stock market, due to which people are avoiding investing money in stocks. In such a situation, PPF and FD are very popular investment options. Now the question is, which of these two is the best?

If you want to invest money in a place with guaranteed returns, then both PPF and FD are good for you. However, if you want to choose one, then for this you have to look at both of them on 4 parameters. This will help you decide whether to choose PPF or FD.

Most banks give interest between 6.7% to 7.1% annually on FD. At the same time, PPF is currently getting 7.1% interest. That is, PPF and FD are the same in terms of interest. However, if you feel that your bank is giving less interest, then you can choose PPF.

If you invest money in PPF, you get tax exemption under section 80C of Income Tax in the old system. At the same time, its interest is tax free in both the new and old systems. At the same time, there is no exemption on investment in FD and the interest received on it is also taxable in most cases.

If you invest in PPF, you will not be able to withdraw money for 15 years. On the other hand, if you invest money in FD, then there is no such restriction on you. However, before making an FD, you have to decide for how many years it will be. It is for up to 5 years and you have to pay a small charge if you break it before time. Often people look at the returns, but make the mistake of not paying attention to the lock in period.

A minimum of ₹ 500 and a maximum of ₹ 1.5 lakh can be invested in PPF in a year. On the other hand, if you want to invest money in an FD, then you can invest as much money as you want.