Nowadays everyone saves something to secure their future. Employee Provident Fund Organization (EPFO) is also one such scheme that can provide you a good amount at the time of retirement. Investing in EPFO not only makes your future safe, but it can also make you a millionaire. In this article, we will tell you how you can become a millionaire through EPFO and how many years you will have to do for this.
EPFO is a scheme in which both employees and employers contribute together. This contribution increases over time and increases your savings manifold with the interest rate. If you start investing in EPFO at the beginning of your career, then you may have a large amount of money till retirement. In this article, we will tell you in detail about EPFO and also tell how you can become a millionaire through EPFO.
What is EPFO and its benefits
EPFO (Employee Provident Fund Organization) is a government organization that runs the Provident Fund Scheme for Employees. The scheme is designed to provide employees a safe future at the time of retirement. EPFO contributes together both employees and employers, which is a certain percentage of the employee’s basic salary.
The main advantages of EPFO:
- Long -term savings: EPFO helps you save for long periods.
- Interest Rate: The interest rate on EPFO helps to increase your savings.
- Tax Benefits: You also get tax benefits by investing in EPFO.
- Pension and Insurance: EPS (Employee Pension Scheme) and EDLI (Employee Deposit Linked Insurance) are also associated with EPFO.
How to become a millionaire from EPFO
To become a millionaire from EPFO, you have to start investing at the beginning of your career. Here is an example of how you can become a millionaire by investing in EPFO:
Suppose you start work at the age of 23 and your basic salary is Rs 10,000. Both employees and employers together contribute 12% of the basic salary in the EPFO. Of this, 12% of the employee and 3.67% of the employer goes to EPF, while the employer’s 8.33% goes to EPS. If your salary increases 10% every year, then in 37 years your EPF account can be around Rs 1.98 crore.
Essential experiences to become a millionaire through EPFO:
If you want to become a millionaire by investing in EPFO, then you have to work for at least 30 to 40 years. This time will help increase your saving manifold with an increase in your salary and interest rate.
Details of EPFO Scheme
The table below gives details of the EPFO scheme:
| Description | Details |
| Contribution | Both employees and employers contribute 12% of the basic salary. |
| Interest rate | The current interest rate is 8.25%. |
| Pension scheme | EPS (Employee Pension Scheme) contributes 8.33% of the employer. |
| Insurance scheme | EDLI (Employee Deposit Linked Insurance) contributes 0.5%. |
| Tax benefits | There is no tax on the contribution of up to Rs 1.50 lakh. |
| Evacuation rules | The entire amount can be withdrawn only after retirement or leaving the job. |
Benefits of investment in EPFO
Investing in EPFO gives you many benefits:
- Long -term savings: EPFO helps you save for long periods.
- Interest Rate: The interest rate on EPFO helps to increase your savings.
- Tax Benefits: You also get tax benefits by investing in EPFO.
- Pension and Insurance: EPS and EDLI are also associated with EPFO.
Other schemes associated with EPFO:
- EPS (Employee Pension Scheme): This scheme provides you with pension after retirement.
- EDLI (Employee Deposit Linked Insurance): This scheme provides you with free insurance cover, which provides financial assistance to your family on your death.
How to invest in EPFO
To invest in EPFO, you have to open an EPF account through your employer. Here are some stages given:
- Opening EPF account: Open EPF account from your employer.
- Getting UAN (Universal Account Number): UAN helps in managing your EPF account online.
- Regular contribution: Contribute to EPF from your salary every month.
- Take advantage of the interest rate: Take advantage of the interest rate on EPF and increase your savings.
conclusion
EPFO is a scheme that can give you a safe future at the time of retirement. If you start investing in EPFO at the beginning of your career, then you can easily become a millionaire. By investing in EPFO, you get many benefits like long -term savings, interest rates, tax benefits, and pension and insurance.
Disclaimer: This article is for general information and should not be taken as any special financial advice. It would be appropriate to consult a financial advisor before investing in EPFO. EPFO’s interest rates and rules change from time to time, so check the current rules before investing.
