The lock-in period of PPF is also 15 years whereas the lock-in period in case of ULIPs is 5 years. Among other Section 80C options, NSC has a lock-in period of 5 years whereas in case of tax-saving fixed deposits, the lock-in period is 5 years. Shortest lock-in period: The lock-in period of ELSS funds is just 3 years, the lowest among all tax saving investment options eligible for Section 80C deduction. Hence, being invested in equities, ELSS funds have the potential to generate higher returns other Section 80C instruments like Public Provident Fund (PPF), National Savings Certificate (NSC) and tax saving bank fixed deposits over the long term. Higher returns: Even though equities as an asset class can be very volatile in the short term, they usually beat other asset classes including the fixed income asset class by a wide margin over the long term. ELSS schemes have superior product features than other tax saving investment options under Section 80C like PPF, ULIP, NSC and tax saving bank FDs.
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