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A salaried employee wish to buy a flat costing Rs. 10
Lakhs therefore he would either opt for a house loan paying huge interest rates
or one would go for advance/ withdrawal from PF but that's a long long procedure.
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Therefore rather than opting for the archaic EPFO (Employees
Provident Fund Organisation). Instead of waiting aeons for his PF proceeds, one
can withdraw money from his PF account in a couple of days.
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That's just one of the many advantages of an exempted
PF trust. We take a look at the other ways in which this kind of trust scores over
the EPF that is supervised by the regional PF commissioners.
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Why PF? When you join any provident fund it means that
you automatically make regular, mandatory, tax-qualified, defined contributions
that accumulate till you retire. You contribute 12 per cent of your basic pay, and
your employer matches this amount.
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"With no social security available, this instrument enables
employees to build a corpus to see them through tough times between jobs -- as the
amount can be partly withdrawn as a loan -- and finally after retirement."
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