Considering the current level of interest rates, the public provident fund (PPF), which offers 8 per cent tax-free interest, is indeed very attractive. Therefore, strive to invest the maximum permissible Rs 70,000 in it every year.

• Contribute, even if the rebate under Section 88 is not available by virtue of your taxable income being above Rs 500,000, because the returns are very good.
• Yes, there is the issue about the average term of PPF being 16 years. But remember, the average lock-in period is much less.
• The normal feeling is that it is fallacious to open a PPF account after one becomes a senior citizen. It is not too late for anyone. Also, have a PPF account in the name of every adult member of the family, even if he or she is not a taxpayer at present.
• Another thumb rule is, always put the money into PPF right in the beginning of the year for two reasons: One, this will give you maximum returns for the year and second, because contributions no longer need to come out of your income chargeable to tax.
• Do not use the premature withdrawal facility, unless there is extreme emergency. Allowing the compounding factor to work gives magical results.