Equity Linked Savings Schemes

Equity Linked Savings Schemes popularly called ELSS is a type of equity diversified mutual fund, which invests most of your money in stocks. ELSS has a compulsory 3 year lock-in. You cannot touch your money for 3 years. ELLS not only helps your money grow, it also helps save tax with ELSS and you enjoy the compounding benefits of return to return. You can invest a lump sum in ELSS or you can invest in ELSS via SIPs (Systematic Investment Plans). SIPs allow you to invest small sums of money regularly, say once a month or quarter, in the ELSS. SIPs help you average purchase costs, bring financial discipline in your life and give you the compounding benefit.

Why invest in ELSS?

Invest small amounts

You can invest a small amount of Rs 500 a month via SIPs in an ELSS.

Short lock-in

ELSS has the shortest lock-in period among other tax-saving instruments like PPF, Tax saver FD, NSC and so on.

Gives good returns

ELSS has a 3 year lock-in period which forces you to stay invested in equities. Staying invested in equities for the long term, generally means good returns.

Tax Benefits

The investments you make are tax-free up to Rs 1.5 lakhs a year under Section 80C.


Key factors to consider for ELSS

Factors to consider while investing in ELSS

  • Invest in ELSS at the start of the financial year to save tax. Invest in ELSS through SIP.
  • Look for consistency in the ELSS scheme. The ELSS scheme must be a consistent performer for at least 3-5 years.
  • Don’t rush to redeem the ELSS after the lock-in period of three years. Stay invested for may be two more years to pocket higher returns.
  • If you invest to too many ELSS schemes, it would be difficult to monitor performance. Stick to an investment in just 2-3 ELSS schemes.

How to make a claim on a Personal Accidental Insurance Plan?

Inform the insurer about the accident:

  • The insurer must be informed about the accident as soon as possible. The insurer may also be informed while the insured is on the way to the hospital. In order to show proof that the claim has been filed with the insurer, the policy number or reference number of the insurer should be communicated.

Inform the insurer at the time of hospitalization:

  • Fill the claim form.
  • Submit the FIR or police report if required.