Which is beneficial to invest in EPF, VPF and PPF? Know the features and drawbacks of all three schemes

Provident Fund schemes are the first choice of investors looking to invest risk free for the long term. Not only do they get good returns, but there is no risk of losing money. Tax exemption is available, that is different.

Employees’ Provident Fund (EPF), Public Provident Fund (PPF) and Voluntary Provident Fund (VPF) are investment schemes that not only give good returns but are also safe. While all these schemes guarantee a certain return on investment, they also get the benefit of tax exemption. This is the reason why these provident fund schemes are very much liked by investors looking for risk free investments for the long term.

There are many benefits of investing in all these three schemes. That is why it is very difficult for investors to choose one of these. EPF is a mandatory contribution from the salary of a working person. Anyone can do PPF, whether he works or not. Similarly VPF is a voluntary scheme. It does not have a separate account. For this, investment has to be made in the EPF account itself.

Employees Provident Fund

 According to a report by CNBC TV18, under this scheme, the employee has to deposit a fixed amount of his salary in the EPF account. The employer also deposits the same amount in the employee’s EPF account as the employee. Interest is earned on the amount deposited on EPF and tax exemption is also available in it.

 public provident fund

 PPF is a guaranteed investment scheme of the government. In this the return is fixed and tax exemption is available. Its special thing is that salaried and non-salaried people can invest in it. The employer does not make any contribution in PPF. Compound interest is available in PPF. One can invest in this scheme for 15 years.


Voluntary Provident Fund or Voluntary Provident Fund is a voluntary scheme. Whatever you invest in EPF, it goes to VPF. This is different from the 12 per cent investment to be made in EPF. The Voluntary Provident Fund earns the same interest as the Employees’ Provident Fund (EPF). Its interest rates change every year.

Where to invest?

The employed person invests in EPF only. If you are salaried and want to accumulate more funds for retirement, then you should also invest in VPF. You can deposit money separately in PPF. The decision to invest in either PPF or VPF depends on the investment capability of the individual and expectation of return on investment. Since VPF is getting more interest, you can create more retirement fund at a faster rate by investing in it.

If you want to achieve any financial goal within 15 years, then you should invest in PPF. Those who have more income can invest in both VPF and PPF for tax free interest. PPF is the best investment option for the self employed. It is a good investment tool for tax saving and making a big corpus in the long term.

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