The most common mistake that people make is making their 80(c) investments (Tax saving ELSS Mutual funds ) at the end of the financial year. You can read a detailed article at — Your Biggest Mistake on Tax Savings! Avoid in 2017 — Upwardly
The ideal way to invest in tax saving instruments is to start investing early in the year. If you have the funds, then figure out how much you should invest to get to your cap of 1.5 lakhs (max limit on 80c investments) and start investing at the beginning of the year. You can also check out our ratings of best ELSS funds on Upwardly.
So why Invest in ELSS Funds?
ELSS funds are fundamentally attractive because they are a much better option to save taxes under Section 80(c) as compared to any other option in the peer group (see comparison). They have the lowest lock in and highest return!
But before you jump into the decision on investing in ELSS now or not, it is important to figure out 1. if you should
The quick answer is, if you have not had a largish home loan, PF or PPF investments (totalling up to less than 1.5 Lakhs), you must invest in ELSS to get to the 1.5 lakhs limit on 80(c) investments.
2. And how much should you invest in ELSS? Figure out what you need to invest here.
Once you have the answer to both, with #1 being yes and #2 being a non-zero number, you need to figure out the answer to timing.
You can never time the market. You are better off with investing in a monthly manner so that you can average out your costs on the ELSS funds.
How much to invest
Though the upper limit of 80c investments is 1.5 lakhs, you should check how much you need to invest in ELSS Mutual Funds and also how much you can reduce in taxes with this investment.
Know how much you can reduce
If you haven’t planned your tax saving investments yet, it’s never too late to start! You can Invest in Best ELSS Mutual Funds and save Tax in 5 Mins
It’s 100% paperless investing and you get the investment proof instantly! Moreover, you can also access performance anywhere.
Ready to start your Tax-Saving Investment?