'Withdraw PPF And Invest In Stocks?'

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Anonymous: Hi Experts, I have a query regarding my PPF (Public provident fund) investments and would really appreciate a simple explanation. I have been investing 1.5 lakhs per year in my PPF account since March 2011. In 2014, I opened another PPF account for my minor son. Since the maximum allowed investment is 1.5 lakhs per year (combined), I started investing 1.49 lakhs in my son's PPF and 1,000 in my own PPF from 2014 onwards.
Now that it has been 15 years, I understand I am eligible to either withdraw or extend my PPF account for another 5 years.
I have a few questions: When exactly can I withdraw the full amount from my PPF? If I withdraw from my PPF and close it, will it have any impact on my son's PPF account, or can that continue independently?
Can I invest the full 1.5 lakhs in my son's PPF account? Lastly, I know this is subjective, but it your opinion would it make sense to withdraw the PPF amount and invest it in the stock market, especially considering markets are currently low?
I know it's my decision at the end but would like to get an expert opinion. It would really help if you could guide me so I can plan and take a sound decision.

It makes sense for you to withdraw the entire amount once the tenure of 15 years is over which might have been last month. This way, you can maximise investment of 1.5 lakhs in your son's account henceforth.

And you can choose to go for equity mutual funds for long term to park the closure proceedings of your PPF account. And as you said, this is actually the best time to invest in the market considering the correction.

Make sure to go for equity mutual funds rather than direct stocks for your investment; as direct stocks require lot of research and proper entry exit and mutual funds come with comparative ease to choose and invest without worrying for the individual stocks.

Also if you do not have much knowledge on how to start your investments, you can work with a dedicated advisor to guide you throughout.

Hence do consult a professional Certified Financial Planner - a CFP who can guide you with exact funds to invest in keeping in mind your age, requirements, financial goals and risk profile. A CFP periodically reviews your portfolio and suggest any amendments to be made, if required.

Let me know if you need more help.

Manoj: Sir i opened an nps account, i deposited 2500 initially but it is showing market value as 2332 therefore i am afraid i will lose money in this. i already have ppf account therefore how can i close nps account now and get back my invested money.

It is completely normal to see a temporary dip in the market value (from Rs 2,500 to Rs 2,332) immediately after investing, as NPS funds are market-linked. This happens due to market volatility and initial charges/entry loads.

However, if you wish to close your account, it is important to understand the rules and that premature closure will mean you cannot immediately take back the money under normal circumstances.

Premature exit (voluntary closure) is permitted only after completing a mandatory 5 years of participation in the NPS.

Hence the invested amount will have to be there for next 5 years. Consider it a long term investment.

Anonymous: I am 46 years old. We have family of 4 me, my wife and two sons 17 and 9 yrs old. I am having a flat to live in. At present have almost 81 lakhs investment in mutual fund, 15 lakhs in FD and SIP of 1,00,000 pm. I want to create corpus for my retirement at age of 61 of having a monthly income of 1.50 lakhs. Please advise investment.

You have saved and invested quite good at your age. You still have 15 years to retire.

Your current SIP of 1 lakh pm with 81 lakhs that you already have will become 9 crores. This will be good to cover your retirement.

This is considering that other goals like kids' higher education and marriage are already taken care of.

Kailash: I have invested in policy bazaar ulip ..max online saving plan.tata smart sip .. capital guarantee solution.. it return show 16 per cent.. it is good to invest like mutual fund.

Investing in plans like these is not recommended as these are highly commissioned. Better to choose SIPs in mutual funds with the help of an advisor.

Ashok: I have purchased 600 units @ Rs10/ per unit in the month of march 1994. I have certificate of acknowledgement MEP-94. Can I redeem my fund?

Yes, you can redeem your fund. The UTI Master Equity Plan 1994 (MEP-94) was merged into the UTI Master Equity Plan Unit Scheme (UTI-MEPUS) in March 2003.

You can redeem your 600 units (or the converted equivalent units) at the current NAV of the UTI Master Equity Plan Unit Scheme.

You can check the current value of your 600 units by looking up 'UTI Master Equity Plan Unit Scheme -- Growth' on sites like Value Research or Moneycontrol.

Ensure you take the original certificate to the service center to surrender it.

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Any use of the information/any investment and investment related decisions of the investors/recipients are at their sole discretion and risk. Any advice herein is made on a general basis and does not take into account the specific investment objectives of the specific person or group of persons. Opinions expressed herein are subject to change without notice.