ELSS funds: everything you want to know!Posted by swarali chavan on April 21st, 2019 When people look to invest in any instrument, the result expected is high returns and maximum benefits. While most of the mutual funds do offer quick returns and some tax benefits, very few schemes offer the best of both worlds. Equity Linked Savings Scheme (ELSS) not only provide tax efficiency but also impressive returns, which is why they make it to every tax payer’s plan. What is ELSS funds? They are a type of open-ended equity mutual funds that offer tax exemptions under section 80C of Income Tax Act, 1961. A significant chunk of capital goes towards equity funds here. ELSS funds come with a lock-in period of 3 years. After the lock-in period, the investors can exit the scheme by selling it. How to invest in ELSS funds? The minimum investment required for ELSS funds is INR 500. Investors can also invest lump sum amount in one go. Else, investors can opt for Systematic Investment Plan (SIP) method. Who can invest in ELSS schemes? ELSS are ideal for investors who are young and do not earn glamorous salaries. Investors who carry low-risk appetite can also go for such schemes. Those who earn substantially through high-risk investment and are hunting for means to save their taxes, can opt for ELSS funds. The other set of investors who can go for ELSS funds are those who are looking for a diverse portfolio, to accrue high returns over time. What are the benefits of ELSS funds?
What are the options available in ELSS investment? ELSS funds meaning goes beyond returns and growth options, thanks to the numerous tax benefits it offers. ELSS investments help in the following manner:
Now, that you have understood what is ELSS funds, note that individuals can invest in these schemes as soon as they start earning. In fact, taxpayers consider ELSS as a financial haven. Like it? Share it!More by this author |