One of the highly recommended mutual funds which are known as Equity linked saving schemes help in tax savings. Recent SEBI policy updates for these funds have done few changes in funds categories as this segment is quite a popular one and near to many finance experts. These funds are designed for 3 to 5 years maturity with minimum 3 years of lock-in period to get fair returns. Start of the financial year is a good time to enroll yourself in ELSS scheme so you can get the good benefit of tax savings under 80 (c). Though the upper limit of tax exemption is up to Rs. 45000/ and you can invest 1.5 lacs but still, it has a huge amount of audience in this tax value category. The ELSS option is backed up with fair facts as it needs the period of 3 years which is lower if compared to other tax saving option schemes and you can still carry on with your stock if you are getting good outcomes instead of selling it. Any expert would easily tip you to stay invested in your ELSS scheme and urge you to opt longer investment period. This also creates good investment habits for better and safe financial future. These funds are invested in Equity and the same securities. These funds are invested in companies’ equity shares regardless of capitalization for small cap, mid cap or large cap and this indeed helps your funds secure and safe and generates a good outcome for you. With 15% returns the options leaves behind investment in PPF or other tax saving schemes. It gives the option to invest via SIP and pay monthly and the investment value size starts with INR 1000. Makes it well within reach of small investors and debutants in the money market. Many of the investors heard saying that they started it because of the extra option of tax exemption but these constant practice has given us more knowledge of trends and stocks and confidence to explore more opportunities in the financial market, Thus the segment has much more to offer. It requires 3 years to lock in with the investment so, in the sip, you would need to aware that 3 years will be counted on the basis of investment amount debited from your accounts. ELSS makes sense if you see the savings you done as tax exemption and add the profit you earned and this is the reason the funds are dear to finance gurus!! Earlier the profit earned from ELSS was exempted in taxes with benefits up to 1.5 lacs and this was the reason of the huge amount of investors chosen it and the segment got popular on word of mouth but recent updates before budget of 2018 these funds won’t be exempted from tax on profit earned after 3 years. Even then ELSS remains the top choice considering its nature of rewards and tax savings on investments as in 3 years with 12.90 and for 5 years 19.90, the returns have given investors enough reasons for investments.
What time should I invest?
The timing as said above is also critical in investment in this segment so you don’t need to rush at Jan Feb sort of time before your return filing and this creates a situation of rush which cuts down the money market study options and also in event of high prices of equities you tend to overpaid and you may experience forced investment sort of situation for the sake of tax saving, So strategically you must invest in ELSS at the start of the year and be prepared in financial return filing with ease and good options of funds in your bag.
How do I choose which fund?
While choosing your fund do not get attracted to ongoing performer just on the base of the recent encouraging result but work on yearly averages of profits of the fund and see the performance between 5 to10 years this will give you a fair amount of idea about which fund to go with. Here we are highlighting the list of best mutual funds to invest in 2017. Reliance tax saver fund which shows 9.2% in 3 years period and jumps handsomely at 5 years with 21.12% the 2nd is DSP BlackRock Tax Saver Fund which puts behind reliance in 3 years segment with 14.3% and a bit behind as compare to reliance with 20.2%, Axis long-term equity fund shows 14.5% in 3 years and 24.6% in 5 years, Aditya Birla Sun life tax relief has a figure of 15.9% for 3 years and 23.5% as 5 years returns, SBI Magnum tax gain scheme is with 8.7% in 3 years returns tally and 17.4% in 5 years period, ICICI Prudential long-term equity fund has 12% in 3 years and 20% in 5 respectively, All these are the best tax saving mutual fund 2017 and give good indication to those who are looking for tax saving mutual funds.
So if one compares with other savings options like Fixed deposit, Public provident fund, National pension scheme, national saving certificate all give 6 to 10 % returns but as shown in above chart ELSS offers 14 to 24% returns this is on top of your tax savings. So all you need to find the best elss funds to invest in 2017 so you can save taxes and after comparison from top tax saving mutual funds listed above you can get in possibly early at the financial year to get the best outcome on your investments.
The key things need to take in account that this is still a mutual fund and is associated market equities and trends, So if you are looking only tax savings than this isn’t the ideal platform for you until you have financial planning for future as well and open for equities and equity securities investments. If you spend a bit time and see the outcomes and select best tax saving mutual fund than you can have 2 straight benefits of tax savings as well as exploring rewarding opportunities which can be extended based on your personal financial goals.