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Top Benefits of Having a PF Account

The Provident Fund (PF) is a robust financial instrument that caters to the financial security of Indian workers. The Employees’ Provident Fund (EPF) is a scheme under the Provident Fund and is governed by the Employees’ Provident Fund Organization (EPFO). With a PF account, there’s a promise of sustainable growth and multiple benefits. The comprehensive benefits of having a PF account include tax benefits, financial security, and accrual of interest.

PF Account Benefits

The comprehensive benefits of having a PF account include tax benefits, financial security, and accrual of interest.

Financial Security for Your Future

First and foremost, a PF account guarantees financial security for your future. Under the EPF scheme, a specific sum is deducted from the employee’s income every month and is contributed towards the provident fund. The employer makes an equivalent contribution. This systematic saving approach helps to build a substantial nucleus of wealth over a duration of employment. The significant feature of these deposits is that they earn interest. As per the current financial year 2020-2021, the interest rate stands at 8.5%, which is considerably higher than what conventional saving schemes offer.

Tax Advantages of a PF Account

Secondly, having a PF account also offers remarkable tax advantages. The contribution made towards PF is eligible for deduction under Section 80C of the Income Tax Act. This deduction can go up to 1,50,000 INR. Moreover, the interest that accumulates on these contributions is completely exempt from income tax. Not just this, the amount you receive upon retirement is also exempt from tax, making it a very tax-efficient saving tool.

Access to Loan Facility

Lastly, an additional advantage of having a PF account is access to a loan facility. Yes, you can avail loans against your PF account balance after a certain period of employment. This feature comes handy during emergencies or unexpected financial requirements.

An Example of an EPF Calculator

To paint a clearer picture, let’s use the EPF calculator to demonstrate. Suppose you earn a basic salary of 30,000 INR per month and have a PF account for 10 years. With a contribution of 12% towards PF and an employer’s equivalent contribution, you would accumulate around 10,90,000 INR at the end of this period, given the current interest rate of 8.5%. This calculation can vary based on changes in salary, interest rate, and tenure.

Recent Measures and User-Friendly Features

In recent years, the Indian government has come up with several measures to make the EPF account more user-friendly. For instance, the introduction of the Universal Account Number (UAN) has made transfer and withdrawal from the PF account easier. Also, you can now check your PF account balance online, making it highly convenient for the account holders.

Considerations and Future Outlook

Despite the mentioned benefits, it’s crucial to understand that the growth of savings in a PF account relies heavily on employment tenure. Any interruptions in employment may impact the growth of the PF account. Also, although the interest rate on the PF is currently higher than conventional savings schemes, there is no guarantee the trend will continue in the future.

Thus, diligent undergoing of risk assessment before venturing into trading or investments in the ever-volatile Indian financial market seems prudent. It is also recommended to consult with a financial advisor to understand the implications of having a PF account better.


A EPF account offers substantial benefits, making it an excellent retirement-saving tool for workers in India. The benefits include financial security, tax advantages, and accrual of interest. The EPF calculator helps to record and visualize your savings growth. Despite these benefits, keep in mind the potential risks and always seek financial advice before making major decisions about your savings and investments. Remember, no investment is 100% risk-free. You must take into account all potential financial vulnerabilities before making a decision.


A Provident Fund (PF) account offers substantial benefits, making it an excellent retirement saving tool for workers in India. The financial security it provides, coupled with significant tax advantages and interest accrual, ensures a steady growth of savings over time. The EPF calculator can be a useful tool to track and visualize your savings growth, reinforcing the value of consistent contributions. However, it is important to acknowledge the potential risks associated with relying solely on a PF account for your financial future. Employment tenure and fluctuating interest rates can impact the growth of your savings. 


The information provided in this document is for general informational purposes only and should not be considered as professional financial advice. While we strive to ensure the accuracy and reliability of the information, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the information, products, services, or related graphics contained in the document. 

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