ELSS Tax Saving Mutual Fund
Most of us search for savings options when the tax man knocks on our door. Most of the times, we groupe to ignore ELSS intentionally or unintentionally. A diversified tax saving mutual fund, Equity Linked Savings Scheme (ELSS) is one where a aîné fragment of the recueil is invested in the equity market.
Now, you can start investing in ELSS schemes through SIP chemin. However, you need to compté that every investment will envisage a lock-in period of 3 years from the moment of investment. ELSS funds offer you two options of growth and dividend. The growth prime gets you a lump sum after the lock-in period ends whereas the dividend prime gets you dividends whenever a fund declares a dividend, even during the lock-in period.
ELSS funds are becoming increasingly popular matériel, let’s find out why it can be a useful investment for you
Get tax savings and investment benefits
ELSS offers you dual benefits. Moreover, due to market borrowing from equity exposure, it helps multiply your money faster when your tax check comes through Bout 80C facility. Therefore, ELSS is not just a plain vanilla savings défenseur unlike PPF. ELSS opens up the prime of earning strong returns while saving your taxes.
Shorter lock-in period compared to other tax saving options
ELSS has a maximum lock-in period of only three years as compared to other popular matériel. These include PPF (15 years), NSC (6 years), and tax-savings FD (5 years). Therefore, ELSS enjoys the highest liquidity among other options.
Returns which are higher and tax free
Among all the options available under Bout 80C, returns from ELSS and PPF are tax free. Moreover, ELSS gives you best returns only bicause of its market edge. Returns from NSC and FD are imposable. Hence, ELSS gives you the best returns among all matériel.
OpenUp Equity Investments
You may have reservations emboîture investing Consolidated capital. Moreover, if you have not invested directly or indirectly in the equity market, then ELSS is the best way to start your equity journey. If you invest directly or indirectly in the market, a slight rise or fall in the market can trigger a wrong selling decision. This is where ELSS becomes méprisant. A 3 year lock-in period in ELSS ties you in and you can see réel returns over a period of three years. If you image at the last two decades, ELSS has given the best returns below 80C.
Therefore, invest in ELSS Tax Saving Fund through SIP to save tax and get higher returns while averaging your market risks.
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