Tag: EPF

How to Check EPF Balance online ?

Posted on by Jagoinvestor

A lot of us do not have even an idea on how much money we have in our Employee Providend fund account (EPF) and how to check EPF Balance online or offline. So in this post we will see how one can check his EPF balance online and get the details back through sms . Earlier I used to search a lot on checking EPF balance online and I came across some links , but most of them never worked. But few months back I successfully got sms with my EPF balance status. Let me show you that.

How to check your EPF balance online ?

  • Go to this EPFO website link
  • There will be a link below the page to check your EPF account balance status online , click on that (direct link)
  • You will see a drop down there to select the PF Office State ( like Maharashtra, Karnataka , Delhi etc) . Select your PF office .
  • Once you select the State , you will see a list of different cities office, like for Karnataka , you can see one of the options as “Bangalore” along with the “data available upto” date , so you can get your PF balance till that date only .
  • Choose the city office
  • You will be taken to the page where you will have to fill in EPF account number , Your Name and mobile number and Submit.

How to enter your EPF account detail ?

For an example lets say Manish Chauhan worked in Bangalore and had a  Employee Providend Fund account with number KN/62345/876 . This name “Manish Chauhan” is the name appearing in EPF slip .

In that case 62345 will be the Establishment Code (which will be first blank column) and 876 will be the account number (third column) . The second column will be blank in most of the cases , it’s actually the sub code or extension of the establishment code.

EPF balance Online

 Important Points

  • Note that the name should be exactly same as it appears in EPF slip
  • The office and state have to be selected properly , In a single start there can be many offices , make sure you choose the right one.
  • The SMS can come a little late , so please be patient
  • The amount can be only upto a certain date which will be mentioned in the SMS

Can you share if you have are waiting for your EPF money from long time ? Are you facing problem in getting right information on why your EPF money has not reached you ? Were you successful in the enquiry of EPF Balance online ?

EPF interest rate increases to 9.5% for 2010-2011

Posted on by Jagoinvestor

On 15 September 2010, the Employees’ Provident Fund Organisation (EPFO) raised the interest rate for EPF accounts by 1% for 2010-11. The organisation increased the interest rate to 9.5% for 2010-11 from 8.5% in the previous year. This 9.5% is the highest in the last five years. However, one needs to understand that the 1% increase is only for EPF accounts and not for Public Provident Fund (PPF) accounts. A PPF account interest rate will continue to remain 8%. The EPFO is one of the largest provident fund institutions in the world. An EPF is a retirement benefit provided only to the salaried class. Each month, a small amount of money is deducted from an employee’s salary which is invested in his EPF account. The employer also contributes an equal amount.

Note that from 2011, EPF will become the top product in the debt fund category as there is no other “safe” products which gives 9.5% or anywhere closer to that post tax. Also, the money received from EPF is tax free after five years. Hence, in the long run EPF is the best option to invest your money. Thus, make sure you invest part of your salary in EPF account. A lot of employees take their entire salary and prefer not to invest in EPF accounts. Also, many employees withdraw their EPF money after they get a new job or just leave their account inactive.

Be Happy but don’t be very happy

“EPF becomes the best debt instrument” is surely good news from return point of view. But, the 9.5% interest rate may not be for long-term. The 1% increase in the EPF has happened because the EPFO has Rs 1,700 crore of surplus money lying in the interest suspense account. Suspense account is the account which has all the unclaimed PF money.

What about Trusts managing their own Providend Funds ?

Note that all the companies do not contribute to EPFO-managed EPF, but they manage their employees provident funds through their own trusts, Now they will have to match this 9.5% interest and it would be a tough thing to achieve . Most probably , a lot of trusts are going to appeal to the finance ministry, that this 9.5% interest rate proposal is taken back , but it looks unlikely to happen (Read more)

EPF money investment in Stock Market ?

An EPF is a long-term investment which salaried individuals have. Hence, some amount of it can be invested in long-term equity instruments. According to the finance ministry, some amount of EPF can be invested in the stock market. But, the central board of trustees (CBT) don’t agree with the same. The CBT has decided not to invest in the stock market. The labour minister Mallikarjun Kharge, who also heads CBT, says, “We had received a letter from the finance ministry asking for parking of a portion of EPFO funds in the stock market. We have received huge opposition from CBT members who oppose the idea of investing in stock markets.” As of now, the EPFO maintains a huge corpus of approximately Rs 3 lakh crore.

No Interest on Dead Accounts ?

Earlier, employees would just leave their jobs but, their EPF accounts would earn interest. However currently, that’s not the case. Now, the accounts, which are not operated for the last three years, will not earn interest. So make sure you either withdraw money from your EPF account or maintain the account. According to EPFO estimates, there are a total of 47 million accounts, of which 30 million, which means 60%/around 57% are inactive accounts. Out of the 30 million inactive accounts, around 10 million accounts (that is 33%) have less than Rs 500 balance.

The EPFO mentions that maintaining inoperative account is quite expensive. Hence, the organisation has decided to stop crediting interest in all the inactive accounts which have not received contributions in the last three years. (Read this article.)

Comments ? What do you think about this move ?

Everything you need to know about PPF and EPF

Posted on by Jagoinvestor

Everyone wants to spend an easy life without any stress specially related to money. And this is why people are becoming more and more conscious about their savings and investment.

It is good for now that you are working and earning good enough to cover your expenses, but what after your retirement? Have you thought how will you manage your expenses after your retirement?

EPF and PPF

Let me tell you, there are options like EPF and PPF in which you can invest and save your money which you can utilize after your retirement.

Let’s see each of EPF and PPF in detail. Both are provident fund benefits for retirement.

Employee Provident Fund (EPF)

The Employee Provident Fund is a retirement benefits scheme that is available to salaried employees. Under this scheme, a stipulated amount (currently 12%) is deducted from the employee’s salary and contributed towards the fund.

This amount is decided by the government. The employer also contributes an equal amount to the fund. However, an employee can contribute more than the stipulated amount if the scheme allows for it. So, let’s say the employee decides 15% must be deducted towards the EPF.

In this case, the employer is not obligated to pay any contribution over and above the amount as stipulated, which is 12%.

There are some specific features of EPF which are beneficial for the account holder. These features are as follows –

  • Return on Investment: 8.65%
  • If you urgently need the money, you can take a loan on your PF. You can also make a premature withdrawal on the condition that you are withdrawing the money for your daughter’s wedding (not son or not even yours) or you are buying a home.
  • tax benefit under Sec 80C.
  • The amount if withdrawn after completing 5 years in job will not be taxable.

Public Provident Fund (PPF)

The Public Provident Fund has been established by the central government. You can voluntarily decide to open one. For that you need not be a salaried individual, you could be a consultant, a freelancer or even working on a contract basis.

You can also open this account if you are not earning. Any individual can open a PPF account in any nationalized bank or its branches that handle PPF accounts. You can also open it at the head post office or certain select post offices.

You can take a loan on the PPF from the third year of opening your account to the sixth year. So, if the account is opened during the financial year 1997-98, the first loan can be taken during the financial year 1999-2000 (the financial year is from April 1 to March 31).

The loan amount will be up to a maximum of 25% of the balance in your account at the end of the first financial year. In this case, it will be March 31, 1998.

You can make withdrawals during any one year from the sixth year. You are allowed to withdraw 50% of the balance at the end of the fourth year, preceding the year in which the amount is withdrawn or the end of the preceding year whichever is lower.

For example:

If the account was opened in 1993-94 and the first withdrawal was made during 1999-2000, the amount you can withdraw is limited to 50% of the balance as on March 31, 1996, or March 31, 1999, whichever is lower.

If the account extended beyond 15 years, partial withdrawal — up to 60% of the balance you have at the end of the 15 year period — is allowed.

Watch this video to learn more clearly about PPF and EPF:

Features of PPF:

  • The minimum amount to be deposited in this account is Rs 500 per year. The maximum amount you can deposit every year is Rs 70,000.
  • Return on investment : 8%
  • tax benefit under Sec 80C , no tax on the maturity and no tax on interest earned.
  • If you’re involved in a legal dispute, a court cannot attach or question the money in your PPF account.

Who should invest in PPF?

Usually, everyone can invest in PPF but it’s mainly for those people who are very conservative and cant take risks to a great extent.

Anyone who wants to invest in the long term in some secure saving instrument must invest in PPF. To achieve long term goals there are many option like:

  • Mutual Funds (Equity)
  • Shares (Equity )
  • PPF (Debt)
  • Fixed Deposit (Debt)
  •  NSC (Debt)
  •  Others

Out of these, all under the Debt category are safe. PPF is the most recommended if the investment horizon is very long like 15+ years. Because of compounding your money will grow into a big amount.

I would be happy to read your comments or disagreement on any topic. Please leave your queries or doubts in our comment’s section.