123ArticleOnline Logo
Welcome to 123ArticleOnline.com!
ALL >> Investing---Finance >> View Article

What Is Equity Linked Savings Scheme Fund? & Benefit Of The Elss Fund

By Author: Shashank Pawar
Total Articles: 33

ELSS stands for Equity Linked Savings Scheme. The scheme is beneficial for an individual or a Hindu Divided Family (HUF) for saving of 1.5 lacs on their tax deduction. The ELSS is carried out under the 80C of Income Tax Act 1961. ELSS funds are similar to diversified equity funds and differ only by the lock-in period and deduction benefits. Equity Linked Savings Scheme is also known as tax saving mutual funds.
The most significant feature of ELSS is that the lock-in period is only 3 years and it is also applicable to your SIPs (Systematic Investment Plan). The lock-in period is the same even for a monthly installment of your SIP. After the period of 3 years, the invested units can be either redeemed or switched.
Here are some benefits of the ELSS fund: The benefits of ELSS are almost similar to the benefits of a mutual fund of other types. The earnings you get after finishing the lock-in period are 100% tax-free. You get to enjoy the total amount of returns without any deduction. The interest is compound, and hence, the earnings will only be in the multiple numbers of your principal amount.
How is ELSS better than PPF? The most prominent difference between the ELSS and Public Provident Fund (PPF) is the duration of the lock-in period. The lock-in period for ELSS is 3 years, whereas for PPF it is 15 years. Both the investment schemes are issued by the Government of India. The amount invested in ELSS can be displaced a lot quicker in emergency cases than in PPF.
What is the investment procedure for ELSS? The first step is going through the Know your customer (KYC) process and submitting your Permanent Account Details (PAN) to the bank or any asset management company. KYC is a process used for customer identification and is the first step towards opening an account with any financial body. The process is used to set a unique identifier of the account holder with his/her photo identity and residential address proof. Further investment procedures can be done by appointing an agent, or a middle man or the investor can do it on his own.
You can also make ELSS investments online. You can register to an online mutual funds website and immediately start with the procedure.
Ways of receiving benefits from ELSS The benefits gained from ELSS is entirely dependent on market conditions. The investor has the following options for growth:

Dividend: Rather than getting the wholesome amount, you can opt for timely benefits with the option of a dividend. A dividend received by an investor is not liable for taxation.


Dividend Reinvestments: With the option of dividend reinvestments, the investor can give back all the dividends received to be added to the Net Asset Value(NAV). It can be done when the market conditions during the lock-in period of your scheme are favorable.

ELSS is a smart mixture of stability, growth, and tax savings. When invested properly, the ELSS can give huge benefits to the investor.

ELSS stands for Equity Linked Savings Scheme & ELSS is also known as tax saving mutual funds. The most significant feature of ELSS is that the lock-in period is only 3 years and it’s 100 % tax free. Visit us to know more about Mutual Funds Sahi Hai.

Total Views: 26Word Count: 552See All articles From Author

Investing / Finance Articles

1. Things You Should Know About Cash Out Refinance
Author: Refinance Mortgage Guru

2. Quest Ira Services -managing Finances & Planning Your Future
Author: Hayley Barnes

3. If You Want To Buy Home Against Mortgage Then Look For The Best Company
Author: Anu Walia

4. Get Hassle-free Loan Approval With The Support Of Mortgage Lenders.
Author: Jacob Smith

5. What Are The Advantages Of Bank Loans.
Author: Sarah Addyson

6. The Benefits Of Savings Accounts And Bank Loans.
Author: Sarah Addyson

7. Save Your Pocket By Filing Taxes On Time!
Author: Boston financial

8. Opting For A Credit Union Auto Buying Service Winston Salem Nc
Author: Sarah Addyson

9. Should You Stick With Banks In North Carolina?
Author: Sarah Addyson

10. Liquid Funds For Short-term Investment, Low Risk And Higher Returns
Author: Shashank Pawar

11. What Are Some Unsecured Business Loans To Succeed In The Business Sector?
Author: Kalpit Kumar

12. Some Easy Ways To Obtain Startup Loan For New Business
Author: Kalpit Kumar

13. What Are Some Of The Benefits Of Loan Against Property?
Author: Kalpit Kumar

14. Pointers To Consider When Applying For Small Business Startup Loans
Author: Kalpit Kumar

15. Why Every Trading Participants Need Be Familiar With Regulatory Reporting!
Author: Priya Raj

Login To Account
Login Email:
Password:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: