Public Provident Fund + LIC plan: Get rich with Rs 100/Day! End financial woes - Pension, Kids' Education, Marriage, House

Public Provident Fund (PPF) + LIC plan​: All parents want to ensure that they or their children never fall short of money. The rising cost of education, or even life in general, keeps us worried. But what if we tell you that even Rs 100 has the power of ending all your financial woes - be it your pension or your child's marriage or higher education or your wish to buy a dream house. 

But first, let's talk a bit about Rs 100. What was the time when you started spending at least Rs 100/day. If you are young and living in a metro and into partying, travelling, or even smoking, you must have already spent thousands of Rs 100s so far from the days when you were not even working. 

Did you ever wonder that the modest Rs 100 can become a financial miracle? The following example will help you get the answer. 

First, just a few assumptions:

- You are 30-year-old, working, and can afford to save Rs 100/day. 

- You have a newborn child and you wish to see his future financially secure. 

- You are aware of the government's Public Provident Fund (PPF) scheme. If not, check HERE about PPF. 

While there are many options available for investment, including equities and mutual funds, we are talking about PPF here because it is more secure, the  return is assured by the government and also offers tax benefits.  

Second, open a PPF account either in your name or in the name of your minor child. Save Rs 100/day from daily expenses and at the end of the month deposit Rs 3000/month in the account. 

ALSO READ | LIC Jeevan Shanti + PPF pension plan: Invest Rs 5,000/month for 15 years, get Rs 35,000/month

The PPF account is currently growing investors' wealth at the rate of 8% per annum compounded annually. (This may vary over the years. It may even go up). If you continue the investment for 25 years, your Rs 100/day will turn into a corpus of around Rs 27 lakh.

That means when your child crosses 25 years of age, you will have a whopping Rs 27 lakh corpus that can be used either for her/his higher education. You can even spend a part of it and invest the rest for your own retirement, or buy a modest house. 

Alternatively, you can gift the entire PPF money to your child on a promise that they will continue putting Rs 100/day in the account for another 25 years. If he/she manages to do so, then they will get richer by around Rs 2.7 crore when they become 50 years old. Won't that be a financial miracle and the best gift for your child? 

You will be 55 in the next 25 years. You can also use the Rs 27 lakh corpus to buy a pension plan like LIC Jeevan Shanti plan By doing so, you will start getting around Rs 17,000/month pension immediately for a life time. Alternatively, if you start investing Rs 3000/month in the National Pension System (NPS) at the age of 30, you will be able to get a pension of up to Rs 23,748 at a modest 8% per annum rate of interest. Read more about NPS HERE. 

Remember, tax benefits on PPF account applies only on deposits up to Rs 1.5 lakh per year. READ THIS. 

If you can develop an understanding of mutual funds and equities, your Rs 100/day can get even bigger returns. For example: Considering even a modest  10% per annum return, an SIP investment of Rs 3000/month can grow up to Rs 39.8 lakhs in 25 years! READ how you can become crorepati by investing in Mutual Fund

Note: Online calculators have been used for the article. Readers are advised to go through all details of PPF and LIC schemes themselves for a better understanding.