Provident Fund (PF) is the biggest savings for every salaried person, but often it is the most difficult thing to withdraw it when needed. Sometimes the rules were not understood, and sometimes the claim got rejected due to a small mistake. To overcome this problem, EPFO has made the rules quite easy. If you too are tired of visiting offices to withdraw your hard-earned money from your Provident Fund (PF), then there is good news for you.
Facility to withdraw money after only 12 months of service
EPFO has changed its rules, making withdrawing money from PF as easy as withdrawing money from the bank. Now you don’t have to wait for years; You can withdraw 100% of your money in an emergency after just 12 months of service. But will frequent withdrawals have a negative impact on your old age pension? And how many times can you withdraw money in a year? Let us know the answers to all these questions and complete information about the new rules…
What were the problems earlier and what relief has been achieved now?
In the old system, there were around 13 different rules for withdrawing PF depending on different reasons. Some jobs required 2 years’ service, while others required a wait of 5 or 7 years. Due to this, people got confused and they did not get the money on time. Now, EPFO has combined all these rules. The biggest relief is that now only 12 months of service is enough for most of the needs. This means that you can withdraw money from your PF only after working for one year.
When can you withdraw 100% money?
According to the new rules, now up to 75 percent of the total PF balance can be withdrawn easily. However, on some special occasions you can also withdraw 100 percent of your money. Let us know when and how many times you can avail this facility:
For illness: If you or any of your family members need medical treatment, you can withdraw money up to 3 times in a year. Children’s education: For your or your children’s higher education, you can withdraw money up to 10 times during your entire job. Wedding: For your own, your sibling’s, or your children’s wedding, you can withdraw money up to 5 times. House and Land: Facility to withdraw funds up to 5 times for purchasing or constructing a house or repaying a home loan is also available. Without assigning any reason: Under certain circumstances, you can withdraw money twice a year without assigning any reason.
When can you withdraw the remaining 25% of your PF?
According to EPFO, many people repeatedly withdraw all their money, and at the time of retirement they are left with nothing.
According to statistics, 75 percent of people do not have even Rs 50,000 left for their future. Therefore, a rule has been made that on leaving the job, you can withdraw 75 percent of the money immediately, but leave the remaining 25 percent in the account so that your retirement is secure.
If you remain unemployed even after a year of leaving the job, you can also withdraw the remaining 25 percent.
Will this affect your pension?
These new rules for withdrawing PF will not affect your pension. If you have worked for less than 10 years, you can also withdraw your pension money. But if you have completed 10 years of service, then it is wise not to withdraw the pension money, because after retirement you will get a fixed pension every month.
Big advantage of leaving money in PF
It is worth noting that PF is currently offering an excellent interest rate of around 8.25 percent. If you do not withdraw the money, your small amount can become huge in a few years due to compounding. Therefore, withdraw money only when absolutely necessary.
