PF (Provident Fund)

What is PF?

PF, also known as Provident Fund or Employee Provident Fund, is a government-managed retirement plan for salaried employees. Any company having more than 20 employees is entitled to PF.

 

The employees provident fund is a worthy approach to saving money for retirement. According to this scheme, an employee has to save a small amount of their salary every month to get good benefits during their retirement.

 

This scheme is managed by EPFO(Employee Provident fund organization) under the supervision of the Ministry of Labour and Employment, government of India. It was launched in 1951.
 

Also Read: How to claim PF Online? Step by Step Guide

 

EPF Interest Rate

This scheme requires the employee to contribute 12% of their basic salary and dearness allowance every month. Along with the employee, the employer is also required to contribute an equivalent amount to the employee’s account.

 

Eligibility criteria for PF

  • A company with 20 or more employees is mandatorily required to be registered under the Employees Provident Fund.
  • Every salaried employee with less than Rs 15,000 is required to register for an EFP account.
  • Companies with less than 20 employees can voluntarily register for the EFP scheme.
  • An employee can contribute towards EPF up to the age of 58.

 

EPF Benefits

  • Employees can save money in the long run.
  • It helps employees during financial emergencies.
  • Making small investments on a monthly basis helps to save a huge amount over a long period of time.

 

Withdrawal of PF

The Provident fund EPF savings is a long-time investment made by the employer, the employee, and in some cases by the government. An employee at the time of retirement can withdraw the total amount he/she has invested over the years.

 

However, there are certain conditions that an employee has to follow to withdraw the money from the EPF scheme.

 

  • An employee can withdraw the entire amount along with the interest once they reach retirement age.
  • An employee is permitted to withdraw a partial amount before their retirement only in certain special cases like marriage, higher education, medical emergencies, etc., provided certain conditions are fulfilled.

 

Employees can keep check of the PF balance with the help of several Apps

 

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