Skip to main content

ELSS Mutual Funds Investing Strategies

   Best ELSS Funds Online


When it comes to saving tax, Equity Linked Savings Scheme (short for ELSS) of mutual funds is one of the most favoured investment options. It has a lock-in period of 3 years and has the potential to provide you high returns linked to the market. Moreover, there is no limit to making investments in these schemes. However, one should devise a proper strategy while investing in ELSS to gain good returns over a period of time. This is because the returns are market-linked and not guaranteed.

Here are four important strategies that one should adopt while investing money in ELSS.

Invest in lump-sum or in SIP mode?

The best way to invest into an ELSS is to plan ahead by taking stock of your projected Section 80C deficit at the start of the financial year, and then start a monthly SIP to cover the gap. Not only will this make it easier on your pocket, it will also smoothen your long-term returns through rupee cost averaging.

Even if you have a lump sum to invest in ELSS, it is advisable to exercise caution, given the rich market valuations right now. Lump-sums can be staggered into an ELSS by parking the money into a liquid fund, and starting an STP (Systematic Transfer Plan) that will complete the deployment into the ELSS within the requisite time frame

Should you invest in the same fund again?

Investors are at times confused on whether they can invest in the same fund in which they invested in the previous year. Also, how will they get the tax benefit and on maturity how much money they should redeem? Investors can invest in the same ELSS scheme in which they had invested their money in the previous years either in form of a lump sum or through an SIP mode. However, you need to keep a track and monitor the fund performance before investing in the same fund.


You can invest in the same ELSS every financial year. In fact, you can invest as much as you like in an ELSS scheme, but you will get tax benefits only up to the prescribed tax exemption limit of a maximum of Rs 1,50,000.


The tax benefit is given basis the transaction date, as long as the investment(s) are made in the same financial year for which you are seeking tax benefits. After completing 3 years, you can place a redemption request for the units that have completed 3 years or more

Link it to your financial goal

Make sure you align your ELSS investments to a long-term goal such as your retirement or your child's education. Doing so will remove the fixation on the 3-year lock-in period and allow you to benefit from a longer investment horizon in the process. In our view, 3 years is too short a time frame for an equity investment anyhow, and investors should ideally not confuse the mandated lock-in period with the ideal holding period for an ELSS.

Create an investment cycle

While investing money in ELSS regularly in every financial year, you can create an investment-free cycle after the third year of your investments. From the fourth year onwards you can even choose not to invest money from your pocket and still avail tax benefits. Yes, once your first year investment reaches its maturity, after the third year you can redeem the same amount and invest it in the fourth financial year to avail tax benefit. Similarly, the process can be continued for any number of years.                



Invest Rs 1,50,000 and Save Tax up to Rs 46,350 under Section 80C. Get Great Returns by Investing in Top Performing Tax Saving ELSS Funds. Save Tax Get Rich

Top 10 Tax Saving Mutual Funds of 2018

Best 10 ELSS Mutual Funds to Invest in India of 2018

1. Tata India Tax Savings Fund 

2. Sundaram Diversified Equity Fund

3. DSP BlackRock Tax Saver Fund

4. Mirae Asset Tax Saver Fund

5. Birla Sun Life Tax Relief 96

6. ICICI Prudential Long Term Equity Fund

7. Invesco India Tax Plan

8. Reliance Tax Saver (ELSS) Fund

9. BNP Paribas Long Term Equity Fund

10. Axis Tax Saver Fund


Invest in Best Performing Tax Saver Mutual Funds of 2018

Invest Best Tax Saver Mutual Funds Online

Download Top Tax Saver Mutual Funds Application Forms


For further information contact SaveTaxGetRich on 94 8300 8300

OR

You can write to us at

Invest [at] SaveTaxGetRich [dot] Com

OR

Call us on 94 8300 8300


Popular posts from this blog

Am you Required to E-file Tax Return?

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   Am I Required to 'E-file' My Return? Yes, under the law you are required to e-file your return if your income for the year is Rs. 500,000 or more. Even if you are not required to e-file your return, it is advisable to do so for the following benefits: i) E-filing is environment friendly. ii) E-filing ensures certain validations before the return is filed. Therefore, e-returns are more accurate than the paper returns. iii) E-returns are processed faster than the paper returns. iv) E-filing can be done from the comfort of home/office and you do not have to stand in queue to e-file. v) E-returns can be accessed anytime from the tax department's e-filing portal. For further information contact Prajna Capit...

National Savings Certificate

National Savings Certificate Here's everything you need to know about the 5-year savings scheme offered by the Government This is a 5-year small savings scheme of the government. From 1 July 2016, a National Savings Certificate (NSC) can be held in the electronic mode too. Physical pre-printed NSC certificates have been discontinued and replaced with Public Provident Fund-like passbooks. What's on offer The minimum amount you can invest in them is Rs100 and there is no upper limit. Under this scheme, all deposits up to Rs1.5 lakh qualify for deduction under section 80C of the Income-tax Act, 1961. The interest earned is taxable. You can invest in multiples of Rs 100. These certificates can be owned individually, jointly and also on behalf of minors. The interest rates for all small savings schemes are released on a quarterly basis. The effective rate for NSC from 1 October to 31 December is 8%. The interest is calculated on an annual compounding basis and is given along w...

Mutual Fund Review: HDFC Index Sensex Plus

  In terms of size, HDFC Index Sensex Plus may be one of the smallest offerings from the HDFC stable. But that has not dampened its show, which has beaten the Sensex by a mile in overall returns   HDFC Index Sensex Plus is a passively managed diversified equity scheme with Sensex as its benchmark index. The fund also invests a small proportion of its equity portfolio in non-Sensex scrips. The scheme cannot boast of an impressive size and is one of the smallest in the HDFC basket with assets under management (AUM) of less than 60 crore. PERFORMANCE: Being passively managed and portfolio aligned to that of the benchmark, the performance of the index fund is expected to follow that of the benchmark and in this respect, it has not disappointed investors. Since its launch in July 2002, the fund has outperformed Sensex in overall returns by good margins.    While every 1,000 invested in HDFC Index Sensex Plus in July 2002 is worth 6,130 now, a similar amount invested in Sensex then wo...

Different types of Mutual Funds

You may not be comfortable investing in the stock market. It might not seem like your cup of tea. But you can start by investing in Mutual Funds. Many first-time investors invest in Mutual Funds. This is because they do not know how to invest in individual securities. Basic information on Mutual Funds People invest their money in stocks, bonds, and other securities through Mutual Funds. Each Fund has different schemes with specific objectives. Professional Fund Managers look after these schemes. Your Fund Manager could help you invest in a scheme that suits your financial goal. Functioning of Mutual Funds You could make money through Mutual Funds in different ways. A single Mutual Fund could hold many different stocks, bonds, and debentures. This minimizes the risk by spreading out your investment. You could earn dividends from stocks and interest from bonds. You could also earn capital by selling securities when their price increases. Usually, you could choose to sell your share any t...

IDFC - Long term infrastructure bonds - Tranche 2

IDFC - Long term infrastructure bonds What are infrastructure bonds? In 2010, the government introduced a new section 80CCF under the Income Tax Act, 1961 (" Income Tax Act ") to provide for income tax deductions for subscription to long-term infrastructure bonds and pursuant to that the Central Board of Direct Taxes passed Notification No. 48/2010/F.No.149/84/2010-SO(TPL) dated July 9, 2010. These long term infrastructure bonds offer an additional window of tax deduction of investments up to Rs. 20,000 for the financial year 2010-11. This deduction is over and above the Rs 1 lakh deduction available under sections 80C, 80CCC and 80CCD read with section 80CCE of the Income Tax Act. Infrastructure bonds help in intermediating the retail investor's savings into infrastructure sector directly. Long term infrastructure Bonds by IDFC IDFC issued an earlier tranche of these long term infrastructure bonds on November 12, 2010. This is the second public issue of long-te...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now