6 Best ELSS Schemes to Buy During the Tax Planning Season

Posted By:

It's the time of the year when individuals are busy planning for the tax season. Among the many investment avenues for saving tax under Sec 80C is the Equity Linked Savings Scheme (ELSS). The real problem is the choosing of the best ELSS scheme from the number of ELSS schemes that are available.

What Are ELSS Schemes?

6 Best ELSS Schemes to Buy During the Tax Planning Season
ELSS schemes are largely mutual fund schemes that qualify for tax exemption and help you to grow money by investing bulk of the money in the stock market. Now, unlike other tax saving schemes like PPF and Bank tax saving deposits, these schemes cannot guarantee assured returns. The one reason for the same is that they invest money in equities, which are highly risky.

While there is always a possibility to grow your money, there is also a possibility to lose money. In the last few years, ELSS schemes have made more money than traditional fixed deposit schemes, which is why they are being increasingly preferred. We have made the choice easy for our readers by choosing some of the best ELSS schemes.

These are largely on the basis of returns generated in the last one year. As can be seen in the table below bulk of the funds have shown stupendous returns in the last one year. This is largely to do with the markets that have rallied after Narendra Modi tookover as the Prime Minister of the country.

Take a look at the ELSS Schemes that Have Top Performance in India

Name of Fund Last one Year Returns
Reliance Tax Saver 102.00%
IDBI Equity Advantage 87.00%
Axis Long Term Equity Fund 79.00%
Escorts Tax Plan 75.00%
Kotak Tax Saver 72.00%
Birla Sun Life Tax Relief 70.00%

The above tax saving funds have given whopping returns in the last one year. It is almost impossible to replicate these returns in the next one year and if investors are looking at similar returns just forget it. Returns are going to be more nominal in the next few years.

Should you invest in ELSS?

There is no denying that Equity Linked Savings Schemes have generated returns in the last one year. As indicated, these are typically high risk instruments as compared to safer tax saving schemes like PPF, NSC, Bank Tax Savings deposits, but, at the same time can offer superior returns. Go for ELSS if you are ready to take the risk or else stock to the more traditional avenues.


Read more about: elss, mutual funds
Story first published: Friday, February 6, 2015, 8:26 [IST]
Please Wait while comments are loading...
Company Search
Enter the first few characters of the company's name or the NSE symbol or BSE code and click 'Go'

Thousands of Goodreturn readers receive our evening newsletter.
Have you subscribed?