PPF vs NPS — Which is Better?

Both PPF and NPS are excellent retirement instruments with significant tax benefits. PPF: Interest rate 7.1% (revised quarterly), government guaranteed, completely tax free — contribution, interest, and maturity all tax exempt. Lock-in 15 years with partial withdrawal from year 7. Best for conservative investors who want guaranteed, tax-free returns. NPS: Market-linked returns (10-12% historically), mix of equity and debt based on age. Employer contributions up to Rs 50,000 deductible under Section 80CCD2 — massive benefit for salaried. Partial withdrawal at 60% maturity, 40% must be used for annuity. Best for aggressive long-term retirement savings. Verdict: Use both — PPF for guaranteed tax-free base, NPS for higher returns through equity exposure.