Equity Linked Savings Schemes combine an 80C deduction with equity growth and just a three-year lock-in. Plan it in April, not March.
Among Section 80C options, ELSS mutual funds stand out on two counts: the shortest lock-in at three years, and returns linked to equity markets rather than a fixed rate. For investors in the old tax regime with 80C room to fill, they let the tax-saving rupee also be a wealth-building rupee.
March is the worst month to save tax
Every year, lakhs of investors buy tax products in a March panic, at whatever price and terms the deadline dictates. The fix is embarrassingly simple: divide your 80C investment by twelve and run it as a monthly ELSS SIP from April. You get rupee-cost averaging, no year-end scramble, and proofs ready months before the accounts office asks.
Read the fine print that matters
In a SIP, each instalment carries its own three-year lock from its own date. ELSS remains an equity investment, so give it a five-year-plus mindset even though the lock is three. And check regimes first: if the new tax regime suits your income structure better, 80C products may not reduce your tax at all, in which case invest for the goal, not the deduction.
A twenty-minute regime comparison with us at the start of the financial year sets this up correctly for the whole year.
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