Whenever you think of investing your money, your focus is always on security and better returns. You are not the only person to think so. Many times it is seen that investors invest money in the wrong place due to high returns. Let’s know such a scheme where you will get better returns on investment as well as your money will also be safe.
What is an equity-linked saving scheme?
If you want to save tax by investing in mutual funds, then an equity-linked saving scheme may be a better option for you. Investing in ELSS should not just spend money keeping in mind the tax exemption, but also know about the long-term returns of the company, the stability of the business. Given the fluctuations in returns, one should try to avoid change every three years.
Return status: Before investing equity-linked savings scheme, we should know that 65% percent of its money is invested in the stock market. In such a situation, nothing clear can be said about the return. The ELSS has a lock-in period of three years. That is, you can withdraw the investment only after three years.
What is ULIP?
ULIP is an investment in which if you invest money, then you also get better returns with insurance cover. There is a tax rebate on investing in it. To take advantage of the tax exemption in ULIPs, it is necessary that the insurance cover in it is at least 10 times the annual premium. Being covered by the market, ULIPs have lower insurance cover. In such a situation, to save tax, invest 2.5 lakh rupees annually in ULIPs, in return you will get an insurance cover of 25 lakh rupees. While you can buy an insurance policy of 50 lakh rupees at an annual premium of just five thousand rupees. In addition, ULIPs charge a maintenance fee of up to three percent, while ELSS charges up to 2.5 percent.
ULIPs have a lock-in period of five years. Apart from this, if you are unable to deposit the premium even after getting the grace period in the five-year period of ULIP, then the policy ends.
Public provident fund
Public Provident Fund was started in 1968. But even today it remains a favorite of all. A big reason for its popularity is that if you invest your money here, then your money is completely safe. In addition, the investor is also exempted from income tax. If you invest in it for 15 years, then after 7 years you will be able to take a loan on it.
The scheme
Tax rebate
Return rate minimum lock in period minimum investment
ElSS 1.5% up to Rs. 12% – 14% 3 years Rs. 500
Tax exemption on the premium basis under ULIP section 80C as well as exemption under 10 (10D) on maturity on average 16% 5 years Dynamic
1.5 lakh exemption under PPF section 80C 7.90% 15 years 500 to 1.5 lakh
