Finance

Why make a foray into ELSS funds?

5:02 AM RAWAT 0 Comments


The purpose of investing our hard earned money is to have a secure future ahead. For a certain age we work and look to cash in on the fruits of labour ahead. 

The seeds have been planted and our objective is to reap in the rewards at a later stage. There are a couple of ways by which you can make money, either to invest in a smart manner or to make the assets work for you. 

At the same time idle money is not going to lay down eggs. There are various avenues to earn money which is to invest in stocks, shares, bonds etc.


Equity investor adopts a cautious approach to lose out money in the market. The smart investors are cautious about saving and investing money in the long run. If there are long term financial goals, equities seem to be the major choice. 

The main reason why people look to invest in equities is because of the capital appreciation benefits.

This works out to be one of the best forms of financial instruments providing a higher inflation returns and over a period of time you can accumulate wealth.

The moment you make a foray into the equity sector it would get divided into different sectors. In case some of the stocks have gone on to underperform the others can cover up the losses. The levels of risk in your overall market portfolio are reduced. But still if you have   a well-diversified portfolio you cannot escape all the risks.

In fact you can invest in equity with the help of SIP. You can start with even a small investment of Rs 500 a month. 

You can go on to follow an ECS clearing method where money would be deducted from your bank account at a monthly date. This would mean a habit of continuous saving.

More about ELSS

ELSS as the name stands is an equity mutual fund tapering off into a wide range of equity based products. As it is an ELSS funds the returns are typically what you expect from an equity market.

Always be on the lookout for best ELSS funds to invest in 2019

Being an open ended fund you can view it as a form of tax exemption. This does come under the preview of the Income tax act and falls under section 80 C. Not only it offers tax benefits but provides capital appreciation. 

As compared to the other tax saving instruments that have a longer lock in period with ELSS it is only 3 years. A word ofcaution though, in case if you are planning to invest in ELSS funds havea long term financial goal in mind. Do keep the funds for more than 3 years to ensure a steady growth.

To claim rebate under section 80 C ELSS funds are the best avenues. Not only it helps you to save tax but you gain an insight about investing in equity markets as well.

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