Rushing to invest in PPF before April 5? Here's why it may not be a good idea

livemint.com:

Public Provident Fund (PPF) accounts before April 5, hoping to capitalise on the additional interest accrued from early investment. Indeed, depositing a lumpsum between April 1 and April 5 annually in a PPF account, assuming a consistent interest rate of 7.1%, yields a substantial maturity amount compared to monthly deposits of ₹12,500 over the subsequent 15 years. With monthly investments of ₹12,500 in a PPF account for 15 years at a constant interest rate of 7.1%, the total amount earned is ₹40,20,301.

In comparison, depositing ₹1,50,000 into your PPF account by April 5 each year will result in a maturity amount of ₹40,68,209.22 after 15 years. The difference in yields is approximately ₹38,000. While some may argue that “a rupee saved is a rupee earned and vice versa," others may disagree with this perspective.

However, despite the risk-free nature of this investment and the associated tax benefits, is it truly beneficial to rush and deposit money into a PPF account at the start of each month? This question warrants reflection, especially when considering how inflation significantly erodes your savings and investments at a rate much faster than what fixed-income investments can generate over time. There is a lot of goodwill surrounding PPF investments. However, investors should question whether the frenetic rush to open a PPF account and gather funds for investment before April 5 each year is truly worthwhile.