Want to know what is the latest EPF interest rate for financial year 2016-17? EPFO has reduced the EPF interest rate form existing 8.8% to 8.65% recently and this will be applicable for the current fiscal year 2015-16 and also continue on EPF deposit for FY 2016-17.
Why EPF Interest Rate Reduced?
If you have remembered, last time Fm Arun Jaitley has taken the same step and he had to reverted back the changes immediately due to public pressure. But this time the situation is completely different as due to demonetization people started understanding the fact that the interest rates for deposit schemes are going to get decreased.
But, from your retirement saving point of view this may not be a good news. As the EPF interest rates are getting down significantly in last couple for years. If you follow the EPF interest rate historical data then you will be able to understand how much the reduction has happening in actual.
What is current EPF interest rate for this year?
As per the new changes, the current year and next financial year 2016-17, 8.65% interest rate will be applied on your EPF deposits.
EPF interest rates since 1952 – Compare historical rates
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You can refer to the source of this data by visiting EPFO website itself. From this data it is clear that the interest rate of EPF deposits has been decreased significantly and the chances of getting more low is also possible in near future.
What is EPF alternative for retirement planning
You might be thinking in such a case how to plan for retirement as the invested money is going to get less interest in coming days. It is true that many people are depending on the EPF corpus to accumulate their retirement corpus and we have seen the sentiment when EPFO has reduced the interest rate by 1% last time.
So, if you are looking for EPF alternative you have to switch to mutual fund investment through SIP way as through stock market investment only one can create wealth in long term. As per historical data, stock market has returned more than 14% for an investment more than 12 years. So, one can start investing in mutual funds or you can also explore national pension scheme to create retirement corpus.