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One type of investment that usually never fails investors u2013 for several reasons that will be discussed in this documentu2013 is an equity-linked savings scheme. Visit https://www.investmentz.com/ to know more!
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All You Need to Know About Investing in Equity Linked Savings Schemes As popular and dependable means of generating a different form of income, mutual funds have helped many investors accumulate assets over the years. One type of investment that usually never fails investors – for several reasons that will be discussed in this article – is an equity linked savings scheme. What is an Equity Linked Savings Scheme(ELSS)? A type of mutual fund that mainly invests in equities, an ELSS offers various tax-saving options over other types of investments. With a lock-in period of 3 years, it offers higher returns due to investment in the equity capital markets, along with tax benefits on long-term capital gains. Key Benefits of ELSS -Tax Efficient Returns As an investor, you can avail tax benefits, tax-free capital gains and possible dividend income. -Adjustability According to your convenience, you can invest in an ELSS by choosing from a SIP or lump sum investment -Reinvestment of Capital On completion of the 3-year maturity plan, you can reinvest capital in ELSS funds to gain additional tax benefits
-Expert Guidance Based on extensive equity capital markets research, experts are ready to help invest and manage your funds. Go with an SIP Investment Plan or Lump Sum Investment? While SIPs involve regular investment of smaller amounts of money, a lump sum investment is quite the opposite: you will put in all your money at the start of the investment journey. When it comes to ELSS, which is the better strategy to go with? In order to come to a decision, look at these factors: -Amount of Cash on Hand Depending on the situation, you have to assess your cash on hand. If you have a steady job, an SIP investment plan is an ideal way to go. However, if you receive some amount of money from, say, the sale of property or a huge bonus, then a lump sum investment would be better. -Returns on Investments While lumpsum investments offer the potential of higher returns in favourable markets, in unfavourable markets, losses are comparatively lower when you invest through SIPs. -Risk Appetite With a SIP, you are only investing a portion of your total capital; hence, there is more protection involved. A seasoned investor is better off investing a lump sum amount because they will be able to predict the markets better. ELSS and NRI Investments
According to financial experts, ELSS is the best option for NRI investments. Unlike ordinary resident Indian tax payers, NRIs have some limitations regarding claim to tax deductions under Section 80C of the Income Tax Act. So, investment options that offer a longer lock-in period (such as three to five-year tax-saving fixed deposit schemes) benefit NRIs immensely. Also, ELSS works for those NRIs who are aggressive investors who wish to take on some risk. Whether you’re an investor looking to invest in an equity linked saving scheme or you simply need advice on equity, equity-linked and equity derived products including which shares to buy, we are here to improve your investment journey.