Kids' PPF at ₹5,000/month: How Much They'll Get?

Opening a PPF account for your child and investing ₹5,000 every month can grow into over ₹1 crore by the time they turn 18, thanks to tax-free compounding at 7.1% interest. Here's exactly how it works.

Here's what happened: PPF currently earns 7.1% per year, compounded annually, and is fully tax-free at maturity — making it one of India's safest long-term saving tools.. A minor's PPF account can be opened by a parent or guardian at any post office or authorised bank; the annual investment limit is ₹1.5 lakh per year across both parent and child accounts combined.. Investing ₹5,000 per month (₹60,000/year) for 15 years totals ₹9 lakh in deposits — but with compounding at 7.1%, the maturity value crosses ₹16 lakh; extending via 5-year block renewals pushes it well beyond ₹1 crore over 25 years..

What you should do: Open a minor PPF account at your nearest post office or SBI/PNB branch with your child's birth certificate, your KYC documents, and a minimum deposit of ₹500.. Start your SIP-style PPF deposit on the 1st of every month before the 5th — interest is calculated on the lowest balance between the 5th and month-end, so early deposits earn more each month.. Track the combined ₹1.5 lakh annual cap across your own and your child's PPF accounts to avoid excess deposits, which earn zero interest and are returned without any gain..

Pro tip: Once your child turns 18, the account transfers to their name and they can extend it in 5-year blocks with or without fresh deposits — letting the corpus keep compounding tax-free well into their 20s.