fincash logo SOLUTIONS
EXPLORE FUNDS
CALCULATORS
LOG IN
SIGN UP

Fincash » Mutual Funds » TaxSaver

Why ELSS Over Other Tax Saving Investments

Updated on March 22, 2023 , 1293 views

ELSS funds also known as Equity Linked Savings Scheme is an equity-diversified tax saving Mutual Fund that majorly invests its assets in equities or equity-linked instruments like stock markets. The ELSS Mutual Funds offer Market-linked returns, which are volatile and are dependent on the market conditions. However, financial advisors suggest Investing in ELSS funds for a long duration, as these ELSS Mutual funds generate best returns when invested for a longer duration. In the recent reports, it was seen that ELSS funds generated around 20%-30% returns when invested for 3 years, which is much more than the returns generated by other Mutual Funds.

ELSS

Comparison Of ELSS & Other Tax Saving Investment Options

The comparison of ELSS and other tax saving is based on parameters like tenure, returns, eligibility for Deduction under 80c, etc.

Let's have a look:

Parameter PPF NSC FD ELSS
Tenure 15 years 6 years 5 Years 3 years
Returns 7.60 % (Compounded Annually) 7.60 % (Compounded Annually) 7.00 - 8.00 % (Compounded Annually) No Assured Divividend / Return as it market linked
Min. Investment Rs. 500 Rs. 100 Rs. 1000 Rs. 500
Max. Investment Rs. 1.5 Lakhs No Upper Limit No Upper Limit No Upper Limit
Amount Eligible for Deduction under 80c Rs. 1.5 Lakhs Rs. 1.5 Lakhs Rs. 1.5 Lakhs Rs. 1.5 Lakhs
Taxation for Interest/return Tax-Free Interest Taxable Interest Taxable Gains up to Rs 1 lakh are free of tax. Tax at 10% applies to gains above Rs 1 lakh
Safety/Ratings Safe Safe Safe Risk

Top 5 ELSS Funds To Invest In 2023

Below is the list of Fund having Net Assets/AUM between 100 - 200 Crores.

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)5 YR (%)2022 (%)
PGIM India Tax Savings Fund Growth ₹23.58
↓ -0.18
₹451-2.9-0.2-0.134.612.14.7
Mahindra Mutual Fund Kar Bachat Yojana Growth ₹18.2709
↓ -0.17
₹525-3-2.2-0.631.810.22
Principal Tax Savings Fund Growth ₹318.454
↓ -2.30
₹931-4.1-5.3-0.331.79.64.3
BOI AXA Tax Advantage Fund Growth ₹94.85
↓ -0.98
₹677-3.8-4.7-1.431.412.1-1.3
Sundaram Diversified Equity Fund Growth ₹145.074
↓ -1.13
₹1,623-3.7-4.80.930.68.34
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 24 Mar 23

Ready to Invest?
Talk to our investment specialist
Disclaimer:
By submitting this form I authorize Fincash.com to call/SMS/email me about its products and I accept the terms of Privacy Policy and Terms & Conditions.

1. PGIM India Tax Savings Fund

"The primary objective of the Scheme is to generate long-term capital appreciation by predominantly investing in equity & equity related instruments and to enable eligible investors to avail deduction from total income, as permitted under the Income Tax Act, 1961 as amended from time to time. However, there is no assurance that the investment objective shall be realize"

PGIM India Tax Savings Fund is a Equity - ELSS fund was launched on 11 Dec 15. It is a fund with Moderately High risk and has given a CAGR/Annualized return of 12.5% since its launch.  Return for 2022 was 4.7% , 2021 was 37.5% and 2020 was 17.9% .

Below is the key information for PGIM India Tax Savings Fund

PGIM India Tax Savings Fund
Growth
Launch Date 11 Dec 15
NAV (24 Mar 23) ₹23.58 ↓ -0.18   (-0.76 %)
Net Assets (Cr) ₹451 on 28 Feb 23
Category Equity - ELSS
AMC Pramerica Asset Managers Private Limited
Rating Not Rated
Risk Moderately High
Expense Ratio 0
Sharpe Ratio 0.03
Information Ratio 0.68
Alpha Ratio 1.76
Min Investment 500
Min SIP Investment 500
Exit Load NIL

Growth of 10,000 investment over the years.

DateValue
28 Feb 18₹10,000
28 Feb 19₹9,555
29 Feb 20₹9,842
28 Feb 21₹13,221
28 Feb 22₹16,370
28 Feb 23₹17,188

PGIM India Tax Savings Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹300,000
expected amount after 5 Years is ₹415,684.
Net Profit of ₹115,684
Invest Now

Returns for PGIM India Tax Savings Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23

DurationReturns
1 Month -2.2%
3 Month -2.9%
6 Month -0.2%
1 Year -0.1%
3 Year 34.6%
5 Year 12.1%
10 Year
15 Year
Since launch 12.5%
Historical performance (Yearly) on absolute basis
YearReturns
2022 4.7%
2021 37.5%
2020 17.9%
2019 8.2%
2018 -6.4%
2017 39.3%
2016 1.7%
2015
2014
2013
Fund Manager information for PGIM India Tax Savings Fund
NameSinceTenure
Srinivas Ravuri14 Sep 193.39 Yr.
Puneet Pal1 Dec 211.17 Yr.
Utkarsh Katkoria1 Jun 211.67 Yr.

Data below for PGIM India Tax Savings Fund as on 28 Feb 23

Equity Sector Allocation
SectorValue
Financial Services34.48%
Technology9.77%
Health Care8.56%
Industrials8.13%
Consumer Cyclical6.78%
Basic Materials6.09%
Energy5.69%
Utility5.01%
Consumer Defensive4.81%
Communication Services4.14%
Asset Allocation
Asset ClassValue
Cash6.54%
Equity93.46%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
HDFC Bank Ltd (Financial Services)
Equity, Since 31 Dec 15 | HDFCBANK
8%₹36 Cr222,200
ICICI Bank Ltd (Financial Services)
Equity, Since 31 Jan 16 | ICICIBANK
6%₹25 Cr298,500
Infosys Ltd (Technology)
Equity, Since 31 Dec 15 | INFY
6%₹25 Cr161,129
HDFC Life Insurance Company Limited (Financial Services)
Equity, Since 31 Mar 22 | HDFCLIFE
5%₹22 Cr377,700
Reliance Industries Ltd (Energy)
Equity, Since 31 Aug 17 | RELIANCE
5%₹21 Cr89,750
Larsen & Toubro Ltd (Industrials)
Equity, Since 30 Sep 17 | LT
5%₹20 Cr95,664
Axis Bank Ltd (Financial Services)
Equity, Since 30 Nov 21 | 532215
4%₹19 Cr218,000
Bharti Airtel Ltd (Communication Services)
Equity, Since 28 Feb 19 | BHARTIARTL
4%₹19 Cr240,805
State Bank of India (Financial Services)
Equity, Since 31 Oct 18 | SBIN
4%₹16 Cr294,174
GAIL (India) Ltd (Utilities)
Equity, Since 31 Jan 22 | 532155
3%₹15 Cr1,546,558

2. Mahindra Mutual Fund Kar Bachat Yojana

The investment objective of the Scheme is to generate long-term capital appreciation through a diversified portfolio of equity and equity related securities. The Scheme does not guarantee or assure any returns.

Mahindra Mutual Fund Kar Bachat Yojana is a Equity - ELSS fund was launched on 18 Oct 16. It is a fund with Moderately High risk and has given a CAGR/Annualized return of 9.8% since its launch.  Return for 2022 was 2% , 2021 was 39.4% and 2020 was 14.1% .

Below is the key information for Mahindra Mutual Fund Kar Bachat Yojana

Mahindra Mutual Fund Kar Bachat Yojana
Growth
Launch Date 18 Oct 16
NAV (24 Mar 23) ₹18.2709 ↓ -0.17   (-0.93 %)
Net Assets (Cr) ₹525 on 28 Feb 23
Category Equity - ELSS
AMC Mahindra Asset Management Company Pvt. Ltd.
Rating Not Rated
Risk Moderately High
Expense Ratio 2.38
Sharpe Ratio -0.01
Information Ratio 0.22
Alpha Ratio 1.3
Min Investment 500
Min SIP Investment 500
Exit Load NIL

Growth of 10,000 investment over the years.

DateValue
28 Feb 18₹10,000
28 Feb 19₹9,175
29 Feb 20₹9,504
28 Feb 21₹12,301
28 Feb 22₹15,134
28 Feb 23₹15,760

Mahindra Mutual Fund Kar Bachat Yojana SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹300,000
expected amount after 5 Years is ₹395,578.
Net Profit of ₹95,578
Invest Now

Returns for Mahindra Mutual Fund Kar Bachat Yojana

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23

DurationReturns
1 Month -3.2%
3 Month -3%
6 Month -2.2%
1 Year -0.6%
3 Year 31.8%
5 Year 10.2%
10 Year
15 Year
Since launch 9.8%
Historical performance (Yearly) on absolute basis
YearReturns
2022 2%
2021 39.4%
2020 14.1%
2019 4.5%
2018 -9.8%
2017 24.8%
2016
2015
2014
2013
Fund Manager information for Mahindra Mutual Fund Kar Bachat Yojana
NameSinceTenure
Manish Lodha21 Dec 202.11 Yr.
Fatema Pacha16 Oct 202.3 Yr.

Data below for Mahindra Mutual Fund Kar Bachat Yojana as on 28 Feb 23

Equity Sector Allocation
SectorValue
Financial Services31.09%
Technology14.12%
Consumer Cyclical12.47%
Industrials11.61%
Basic Materials8.48%
Health Care5.05%
Energy5.02%
Consumer Defensive4.86%
Real Estate2.73%
Utility1.3%
Asset Allocation
Asset ClassValue
Cash3.28%
Equity96.72%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
HDFC Bank Ltd (Financial Services)
Equity, Since 31 Dec 16 | HDFCBANK
9%₹49 Cr307,676
↓ -6,200
Infosys Ltd (Technology)
Equity, Since 29 Feb 20 | INFY
8%₹44 Cr286,807
ICICI Bank Ltd (Financial Services)
Equity, Since 31 May 19 | ICICIBANK
8%₹42 Cr502,120
↑ 30,000
Reliance Industries Ltd (Energy)
Equity, Since 31 Mar 18 | RELIANCE
5%₹26 Cr111,154
Axis Bank Ltd (Financial Services)
Equity, Since 31 Jan 21 | 532215
4%₹22 Cr249,631
Bajaj Finance Ltd (Financial Services)
Equity, Since 30 Nov 21 | 500034
3%₹18 Cr31,000
Larsen & Toubro Ltd (Industrials)
Equity, Since 31 Aug 18 | LT
3%₹18 Cr83,542
Hindustan Unilever Ltd (Consumer Defensive)
Equity, Since 30 Apr 20 | HINDUNILVR
3%₹18 Cr68,112
Tata Consultancy Services Ltd (Technology)
Equity, Since 31 May 19 | TCS
3%₹17 Cr49,286
Maruti Suzuki India Ltd (Consumer Cyclical)
Equity, Since 28 Feb 18 | MARUTI
3%₹15 Cr17,376
↑ 3,100

3. Principal Tax Savings Fund

To build a high quality growth-oriented portfolio to provide long-term capital gains to the investors, the scheme aims at providing returns through capital appreciation.

Principal Tax Savings Fund is a Equity - ELSS fund was launched on 31 Mar 96. It is a fund with Moderately High risk and has given a CAGR/Annualized return of 15.4% since its launch.  Ranked 8 in ELSS category.  Return for 2022 was 4.3% , 2021 was 32.1% and 2020 was 18.9% .

Below is the key information for Principal Tax Savings Fund

Principal Tax Savings Fund
Growth
Launch Date 31 Mar 96
NAV (24 Mar 23) ₹318.454 ↓ -2.30   (-0.72 %)
Net Assets (Cr) ₹931 on 28 Feb 23
Category Equity - ELSS
AMC Principal Pnb Asset Mgmt. Co. Priv. Ltd.
Rating
Risk Moderately High
Expense Ratio 2.44
Sharpe Ratio -0.1
Information Ratio 0.22
Alpha Ratio -0.04
Min Investment 500
Min SIP Investment 500
Exit Load NIL

Growth of 10,000 investment over the years.

DateValue
28 Feb 18₹10,000
28 Feb 19₹9,014
29 Feb 20₹9,197
28 Feb 21₹12,232
28 Feb 22₹14,764
28 Feb 23₹15,223

Principal Tax Savings Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹300,000
expected amount after 5 Years is ₹385,859.
Net Profit of ₹85,859
Invest Now

Returns for Principal Tax Savings Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23

DurationReturns
1 Month -3.1%
3 Month -4.1%
6 Month -5.3%
1 Year -0.3%
3 Year 31.7%
5 Year 9.6%
10 Year
15 Year
Since launch 15.4%
Historical performance (Yearly) on absolute basis
YearReturns
2022 4.3%
2021 32.1%
2020 18.9%
2019 2.5%
2018 -9.2%
2017 48.8%
2016 6.2%
2015 2.7%
2014 49.4%
2013 8.5%
Fund Manager information for Principal Tax Savings Fund
NameSinceTenure
Sudhir Kedia29 Oct 193.26 Yr.
Rohit Seksaria1 Jan 221.08 Yr.

Data below for Principal Tax Savings Fund as on 28 Feb 23

Equity Sector Allocation
SectorValue
Financial Services35.2%
Consumer Cyclical14.43%
Industrials12.89%
Technology10.24%
Energy6.29%
Consumer Defensive5.61%
Health Care4.14%
Basic Materials3.45%
Communication Services1.16%
Real Estate1%
Asset Allocation
Asset ClassValue
Cash5.33%
Equity94.67%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
ICICI Bank Ltd (Financial Services)
Equity, Since 31 Oct 09 | ICICIBANK
7%₹67 Cr803,000
↓ -58,000
Reliance Industries Ltd (Energy)
Equity, Since 31 Dec 21 | RELIANCE
6%₹60 Cr254,000
↑ 79,000
HDFC Bank Ltd (Financial Services)
Equity, Since 31 Jul 09 | HDFCBANK
6%₹54 Cr335,117
Infosys Ltd (Technology)
Equity, Since 31 Jan 09 | INFY
5%₹44 Cr288,000
Housing Development Finance Corp Ltd (Financial Services)
Equity, Since 30 Jun 08 | HDFC
4%₹41 Cr157,000
State Bank of India (Financial Services)
Equity, Since 30 Apr 05 | SBIN
4%₹38 Cr683,000
↓ -87,000
Axis Bank Ltd (Financial Services)
Equity, Since 30 Sep 17 | 532215
3%₹31 Cr356,000
↓ -54,005
Ashok Leyland Ltd (Industrials)
Equity, Since 31 Aug 20 | 500477
3%₹29 Cr1,960,000
↓ -445,310
Polycab India Ltd (Industrials)
Equity, Since 30 Nov 20 | POLYCAB
3%₹29 Cr99,000
↓ -7,000
Tata Consultancy Services Ltd (Technology)
Equity, Since 30 Apr 14 | TCS
3%₹26 Cr78,000

4. BOI AXA Tax Advantage Fund

The Scheme seeks to generate long-term capital growth from a diversified portfolio of predominantly equity and equity-related securities across all market capitalisations. The Scheme is in the nature of diversified multi-cap fund. The Scheme is not providing any assured or guaranteed returns.(There can be no assurance that the investment objectives of the Scheme will be realized.)

BOI AXA Tax Advantage Fund is a Equity - ELSS fund was launched on 25 Feb 09. It is a fund with Moderately High risk and has given a CAGR/Annualized return of 17.3% since its launch.  Ranked 13 in ELSS category.  Return for 2022 was -1.3% , 2021 was 41.5% and 2020 was 31.2% .

Below is the key information for BOI AXA Tax Advantage Fund

BOI AXA Tax Advantage Fund
Growth
Launch Date 25 Feb 09
NAV (24 Mar 23) ₹94.85 ↓ -0.98   (-1.02 %)
Net Assets (Cr) ₹677 on 28 Feb 23
Category Equity - ELSS
AMC BOI AXA Investment Mngrs Private Ltd
Rating
Risk Moderately High
Expense Ratio 2.54
Sharpe Ratio -0.09
Information Ratio 0.19
Alpha Ratio -0.26
Min Investment 500
Min SIP Investment 500
Exit Load NIL

Growth of 10,000 investment over the years.

DateValue
28 Feb 18₹10,000
28 Feb 19₹8,381
29 Feb 20₹10,261
28 Feb 21₹13,855
28 Feb 22₹16,911
28 Feb 23₹17,399

BOI AXA Tax Advantage Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹300,000
expected amount after 5 Years is ₹415,684.
Net Profit of ₹115,684
Invest Now

Returns for BOI AXA Tax Advantage Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23

DurationReturns
1 Month -1.9%
3 Month -3.8%
6 Month -4.7%
1 Year -1.4%
3 Year 31.4%
5 Year 12.1%
10 Year
15 Year
Since launch 17.3%
Historical performance (Yearly) on absolute basis
YearReturns
2022 -1.3%
2021 41.5%
2020 31.2%
2019 14.6%
2018 -16.3%
2017 57.7%
2016 -1.2%
2015 2.1%
2014 44%
2013 9.1%
Fund Manager information for BOI AXA Tax Advantage Fund
NameSinceTenure
Alok Singh27 Apr 220.77 Yr.

Data below for BOI AXA Tax Advantage Fund as on 28 Feb 23

Equity Sector Allocation
SectorValue
Financial Services36.86%
Industrials13.11%
Consumer Cyclical10.18%
Basic Materials9.53%
Consumer Defensive9.3%
Health Care6.25%
Energy4.05%
Technology3.52%
Utility3.17%
Real Estate2.1%
Communication Services0.73%
Asset Allocation
Asset ClassValue
Cash1.2%
Equity98.8%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
ICICI Bank Ltd (Financial Services)
Equity, Since 31 Oct 18 | ICICIBANK
6%₹44 Cr529,340
State Bank of India (Financial Services)
Equity, Since 31 Oct 21 | SBIN
6%₹43 Cr770,000
HDFC Bank Ltd (Financial Services)
Equity, Since 31 Dec 10 | HDFCBANK
6%₹42 Cr265,000
Canara Bank (Financial Services)
Equity, Since 31 Aug 22 | 532483
4%₹27 Cr895,000
NTPC Ltd (Utilities)
Equity, Since 30 Apr 22 | 532555
3%₹22 Cr1,260,000
Reliance Industries Ltd (Energy)
Equity, Since 30 Nov 18 | RELIANCE
3%₹21 Cr91,009
Axis Bank Ltd (Financial Services)
Equity, Since 31 Jan 22 | 532215
3%₹18 Cr204,000
ITC Ltd (Consumer Defensive)
Equity, Since 31 May 22 | ITC
2%₹17 Cr473,223
UltraTech Cement Ltd (Basic Materials)
Equity, Since 30 Apr 22 | ULTRACEMCO
2%₹16 Cr23,000
J.B. Chemicals & Pharmaceuticals Ltd (Healthcare)
Equity, Since 31 Jan 20 | JBCHEPHARM
2%₹15 Cr74,000

5. Sundaram Diversified Equity Fund

To achieve capital appreciation by investing predominantly in equities and equity-related instruments. A three-year lock-in period shall apply in line with the regulation for ELSS schemes.

Sundaram Diversified Equity Fund is a Equity - ELSS fund was launched on 22 Nov 99. It is a fund with Moderately High risk and has given a CAGR/Annualized return of 15.5% since its launch.  Ranked 14 in ELSS category.  Return for 2022 was 4% , 2021 was 31.5% and 2020 was 9.9% .

Below is the key information for Sundaram Diversified Equity Fund

Sundaram Diversified Equity Fund
Growth
Launch Date 22 Nov 99
NAV (24 Mar 23) ₹145.074 ↓ -1.13   (-0.77 %)
Net Assets (Cr) ₹1,623 on 28 Feb 23
Category Equity - ELSS
AMC Sundaram Asset Management Company Ltd
Rating
Risk Moderately High
Expense Ratio 2.1
Sharpe Ratio 0.05
Information Ratio -0.73
Alpha Ratio 2.02
Min Investment 500
Min SIP Investment 250
Exit Load NIL

Growth of 10,000 investment over the years.

DateValue
28 Feb 18₹10,000
28 Feb 19₹9,110
29 Feb 20₹9,518
28 Feb 21₹11,662
28 Feb 22₹13,662
28 Feb 23₹14,366

Sundaram Diversified Equity Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹300,000
expected amount after 5 Years is ₹376,357.
Net Profit of ₹76,357
Invest Now

Returns for Sundaram Diversified Equity Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 24 Mar 23

DurationReturns
1 Month -3.2%
3 Month -3.7%
6 Month -4.8%
1 Year 0.9%
3 Year 30.6%
5 Year 8.3%
10 Year
15 Year
Since launch 15.5%
Historical performance (Yearly) on absolute basis
YearReturns
2022 4%
2021 31.5%
2020 9.9%
2019 6.2%
2018 -10.6%
2017 38.4%
2016 6.8%
2015 3.1%
2014 45.7%
2013 1.4%
Fund Manager information for Sundaram Diversified Equity Fund
NameSinceTenure
Sudhir Kedia1 Jan 221.08 Yr.
Rohit Seksaria24 Feb 211.94 Yr.

Data below for Sundaram Diversified Equity Fund as on 28 Feb 23

Equity Sector Allocation
SectorValue
Financial Services35.03%
Industrials15.67%
Technology11.7%
Consumer Cyclical11.51%
Energy6%
Consumer Defensive4.87%
Basic Materials4.15%
Health Care2.89%
Communication Services1.7%
Real Estate1.1%
Asset Allocation
Asset ClassValue
Cash5.21%
Equity94.79%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
ICICI Bank Ltd (Financial Services)
Equity, Since 30 Nov 11 | ICICIBANK
7%₹118 Cr1,424,000
↓ -101,000
Reliance Industries Ltd (Energy)
Equity, Since 30 Apr 12 | RELIANCE
6%₹100 Cr426,000
↑ 84,405
HDFC Bank Ltd (Financial Services)
Equity, Since 31 Mar 13 | HDFCBANK
6%₹98 Cr611,000
↓ -103,000
Infosys Ltd (Technology)
Equity, Since 30 Nov 16 | INFY
5%₹87 Cr570,000
Housing Development Finance Corp Ltd (Financial Services)
Equity, Since 31 Jul 19 | HDFC
4%₹71 Cr272,000
State Bank of India (Financial Services)
Equity, Since 31 Aug 20 | SBIN
4%₹67 Cr1,207,000
↓ -183,000
Tata Consultancy Services Ltd (Technology)
Equity, Since 31 Jul 20 | TCS
3%₹55 Cr165,000
Axis Bank Ltd (Financial Services)
Equity, Since 31 May 18 | 532215
3%₹55 Cr628,000
↓ -111,000
Polycab India Ltd (Industrials)
Equity, Since 31 Jan 22 | POLYCAB
3%₹51 Cr175,000
↓ -16,000
Ashok Leyland Ltd (Industrials)
Equity, Since 31 Jan 22 | 500477
3%₹51 Cr3,409,000
↓ -680,762

How ELSS Better Than Other Tax Saving Investments?

There are various Tax Saving Investment options in India among which ELSS is one of the best options. How? Here are some of the reasons mentioned.

High Returns over Long-Term

The ELSS funds allocate the highest number of assets in stock market among other tax saving investments. So, these funds earn best Inflation-beating returns amongst all. If invested for a longer duration, the rate of returns of ELSS can easily beat the returns of other traditional debt-oriented investments. Therefore, ELSS Mutual funds provide investors with the best of both worlds- high returns and tax benefits.

Shortest Lock-in Period

The ELSS Mutual Funds have a short lock-in period as compared to the traditional tax saving investment options. The lock-in period of ELSS funds is 3 years while that of PPF is 15 years and of NPS is until retirement. So, by investing in ELSS your money does not get locked for a longer duration and you can stop investing soon after the lock-in is over.

Highly Flexible Investment

The flexibility of ELSS Mutual Funds is much more than all other tax saving investments. Unlike traditional investments, there is no need of investing in only one type of option. ELSS funds enable you to diversify your Portfolio with different kinds of investments. Also, the investors can remain invested in these funds even after the lock-in period is over. So, once the lock-in is over, you can easily choose to remain invested or redeem as per your convenience.

Conclusion

In conclusion, here are a few tips for investors investing in ELSS Funds.

  • Start investing in ELSS early
  • Invest within your limits
  • Do not choose dividend reinvestment
  • Redeem slowly and gradually
  • Invest via a SIP
Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
How helpful was this page ?
Rated 4.6, based on 5 reviews.
POST A COMMENT