ELSS mutual funds are famously known for their tax-saving features in addition to being one of the sought-after mutual fund categories. Under Section 80C of the Income Tax Act, taxpayers can save up to Rs. 1.5Lakh in a deduction from income tax returns after investing in ELSS.
Moreover, other tax saving options under Section 80C have a higher lock-in period, ELSS Funds have a short lock-in period of 3 years, and have the potential to offer higher returns in the long run. Most of the tax-saving investment options have a minimum lock-in period of 5 years. This is another reason to consider ELSS investment. You can also invest through SIP or a systematic investment plan where you invest a small amount of money at regular intervals of time. This can also incorporate a habit of disciplined investment.
Choosing the correct investment options in the available market can be a little difficult. Always get professional advice from investment coaches to select the right funds to meet your goals.
ELSS are equity-linked saving schemes. The investments in ELSS funds up to Rs. 1.5 lakhs are tax deductible under Section 80C of the Income Tax Act. But the ELSS investments have a lock-in period of 3 years. These funds can be redeemed only after 3 years. Similar to other mutual funds, ELSS investments can also be done as lumpsum or SIPs based on your convenience. Therefore, if you are searching for a good investment product, start your mutual fund investment today!