Recently one of my blog reader asked me “can ppf account be closed before 15 years“? So far I have answered all such questions like Can I close my PPF account prematurely saying “NO”. But recently, after changes in ppf account rules and regulations, one can close PPF account in SBI or any other bank before 15 years.
Recently Govt has come up with various changes in PPF account rules and also reverted back couple of them when people protested against them. But with this new PPF premature closure rule will bring smiles on many people’s face as one can use the PPF balance as an emergency fund even before maturity. But it is not necessary to be a win from an investors point of view. Let’s find out the reason here.
Procedure to close ppf account before maturity
The get eligible for Premature Closure of PPF account in SBI or any other bank matures in 15 years is same only. As per the new PPF rules 2016, you should have any of the below reasons to get eligible to close your PPF account before 15 years of maturity.
In case of medical emergency like any life threatening diseases or operation like Cancer or kidney failure, you can ask for the PPF money. The medical treatment can be for any of your spouse, dependent children and dependent parents and off-course yourself.
If you think your kid is eligible to pursue a higher education in any reputed college in India or abroad, then also you can close your PPF account to fund your child’s higher education. In that case you have top produce the education fee bills and other necessary documents to validate the requirement.
Death of account holder (It existed earlier)
This is in-fact the old rule and very obvious rule. In case you (PPF account holder) die, then by default your account will be eligible to close. Your nominee will get the money.
Things to remember before closing PPF account before 15 years
Here are few things which you should if you are thinking of PPF account closure before maturity period of 15 years.
- PPF Account Should be At Least 5 Years Old
- PPF account closure before the maturity comes with a penalty. You can read about this here PPF penalty rules.
So, first of all decide properly what are the emergency fund you have to fund before jumping into PPF account closure. PPF account is one of the best investment option to build long term wealth and one should think 10 times before closing PPF account before maturity.