Equity Linked Saving Scheme or ELSS are tax saving mutual funds. ELSS is an excellent way to enjoy the twin gains of investment and tax benefits.
ELSS has a lock-in period of 3 years. This is the lowest among all tax saving investments. ELSS schemes have performed well in the past few years and gave the highest returns among Section 80C investments.
ELSS helps save Rs 46,800 a year in taxes, if you fall in the highest tax bracket. Invest in ELSS via SIPs. Systematic Investment Plans or SIPs are not mutual funds, but a method of investing in mutual funds. You can invest in ELSS with just Rs 500 a month.
ELSS has a forced lock-in of 3 years. You are forced to hold on to the investment which helps you enjoy the compounding benefit. Compounding benefit is return on return. Don’t liquidate the ELSS investment after 3 years. Stay invested for at least 4-6 years to get the maximum benefit of ELSS schemes.
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Best Tax Saving Mutual Funds to Invest in 2018:
You can take a look at some of popular ELSS schemes in 2018:
Note: Past performance is no guarantee of future performance.
SEE ALSO: Tax Saving Mutual Funds To Invest
If you are investing in ELSS through a mutual fund distributor or a bank, they will assist with requisite documentation. You may be charged additional fees for services rendered by mutual fund distributors.
Invest in ELSS-Direct Plan:
You can invest directly with the Asset Management Company or AMC. Visit the nearest AMC Office or office of their registrar like Karvy or CAMS. You can even invest through the online portal of the mutual fund house. If you want to invest in several ELSS schemes, make sure you register and invest separately in each mutual fund house.
Mutual Fund Utilities: These are shared platforms of different mutual fund houses. You would have to create an account on mutual fund utilities, before transacting. You can invest in different ELSS Schemes across mutual fund houses with a single transaction form.
SEE ALSO: How to invest in ELSS?
Mistakes to avoid in ELSS:
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