Equity Linked Savings Scheme
ELSS is a diversified equity mutual fund, where the majority of the corpus is invested in the equities. investors enjoy two benefits
- Market Edge for the investment
- Save Tax under section 80C
Locked in period 3 years
There are two options.
- Growth: You will get a lump sum after completing the lock-in period
- Dividend: the investor gets a dividend whenever they are announced by the mutual fund house even in the lock-in period
Advantages of ELSS
- Low lock-in period as compared to other investments under 80C like PPF(15 years), NSC (6 years) and FDs (5 years)
- Give better returns.
- Its a gateway to equity investment.
- ELSS is the best option under 80C
- TRY ELSS if never invested in the market.
- Do tax planning at the start of the year.
- If you plan to invest in ELSS, go the SIP way to average out the market fluctuations.