Equity Linked Savings Scheme or ELSS
funds are directly offered by the fund managers and are handled by expert
finance professionals. Besides opportunities to create wealth and enjoy a short
lock-in period, ELSS funds come with an array of benefits that include tax
savings and guidance of a professional fund manager.
that make ELSS a great tax saving instrument
When compared to other tax-saving
investment options like PPF, FD, NSC and others that are available under Sec
80C of ITA, ELSS is a winner.
The following features of ELSS make it
a great investment option and also help to save on tax:
- Good returns on
makes investments in the equity market which earns investors higher returns on
their investments when compared to most other investment options. Besides good returns,
the tax-saving feature of ELSS makes it a favourable investment option for
those investors who want to park their money for medium-term or long-term. On
the basis of past performance in the last 10 years, ELSS has managed to
generate over 12% when compared to the 8% returns earned through PFF.
- Tax-Efficient: ELSS offers
better returns than most other investment options; in a financial year, ELSS
offers investors the opportunity to save up to Rs.46800 under Sec 80C.
- Investment Tenure: ELSS comes with a lock-in period of 3 years,
which is comparatively shorter than that of other investment tools like Employee’s
Provident Fund, National Savings Certificate and Public Provident Fund which
come with minimum investment tenure of 5 years.
- Flexibility: ELSS offers its
investors the feature of flexibility which allows them to manipulate their fund
as per its performance and can shift to other funds anytime as soon as they
complete the lock-in period. This option
may not be available to other investment options.
against Volatility: ELSS is deemed as a good stepping stone for
first-time investors who want to inculcate a sense of discipline towards
investments. The lock-in period helps to build a patient outlook towards
investment and helps investors to make the most of the prevailing market
scenario. ELSS acts as an investment shield against the volatility of the
investment market as it has a provision that helps to lessen the ill-effect of
the market and allows investors to draw out benefits from both highs and lows
Besides its tax-saving aspect under sec 80C of the Income Tax Act, ELSS offers
the investors the feature to team up with PPF to earn better returns. The
combination of ELSS and PPF extends the opportunity to earn more at a stable
rate and also diversifies the portfolio with a great mix of equity and debt.
The ELSS ensures the earning portion owing to the equity composition while PPF
takes care of the stability as it is government-backed security.
Develop a steady investment approach and
increase your opportunity to earn better returns by investing in ELSS funds.
Learn how to make the most of your ELSS investment by availing the best
guidance of our expert fund managers.