What is ELSS fund? By investing in it, you can save lakhs of rupees in tax

ELSS Fund: There are only a few days left for the current financial year to end. The new financial year 2025-26 will start from 1 April 2025. If you are planning to save tax then you still have a chance. If you want to save tax along with better returns, then ELSS fund can be a better option. Being a mutual fund, it gives better returns. Along with this, you can also save tax worth lakhs of rupees. Under section 80C, you can save tax up to Rs 1.5 lakh by investing in specific instruments.

What is an ELSS fund?

ELSS is also called Equity Linked Savings Scheme. It is a type of tax saving mutual fund. Under ELSS, all your money is invested in shares. Due to which the possibility of risk increases. However, along with the risk, the possibility of getting better returns is also high. On the other hand, unlike other tax saving schemes like Bank FD, PPF or National Saving Certificate, it does not provide guaranteed returns.

How much return do you get?

ELSS Returns- Under ELSS you can invest money for a long time and create a big fund. Under ELSS you can invest money for 10 years and get an estimated return of 16 to 18 percent. However, this return depends on the fluctuations of the market. Apart from this, you do not get this return in other safe schemes like PPF, Sukanya Samriddhi Yojana, NPS.

These schemes give a return of about 6 to 8 percent. ELSS investment amount- You can start ELSS with just Rs 500. At the same time, you also get the option of mutual fund SIP in it. Which means that you can deposit money in installments as well. Lock-in period- Along with this, the lock-in period starts from the day you start investing under the ELSS scheme.

Your money remains deposited in the scheme for three years, during this period you cannot withdraw the money, but after the completion of three years, you can withdraw either part or the entire money if you wish. Under SIP, you can deposit money in installments. The date you decide to pay the installment gets locked for three years. For example, suppose you have set the date of paying the installment as 10th April 2025, then the fixed amount will be deducted from your account on the 10th of every month.