Money is undoubtedly a significant part of practically everyone’s life, regardless of gender. And, if you want to improve your current financial situation, you might want to think about investing. Individuals might move a step closer to their ultimate financial objective by investing in mutual funds.
Money is the fuel that propels most ambitions and desires. Money is a symbol of freedom for women. Women are significantly more aware of the necessity of financial independence than men. It can be freeing to have the authority and resources to buy whatever you want without asking anyone. Women today are significantly more self-assured and capable of making their own financial investment decisions.
Now, your mutual fund investments should be made following your investment tenure to build a large enough corpus to meet your objectives on time. But what if a category could provide you with more than just a means of achieving your goal on time?
Here are the 5 reasons why women should invest in ELSS funds.
Save Tax and Gain
To begin with, ELSS funds are mutual funds that invest in stocks. They are multi-cap funds that invest in firms of all sizes – large, mid, and small – across all industries. And as an equity mutual fund, it also can generate wealth through equities over time.
However, another significant advantage of investing in ELSS funds is that you can claim a tax deduction of up to Rs 1.5 lakh under Section 80C. This advantage is not available from any other mutual fund. If you are in the highest income tax category of 30%, you can save Rs 46,800, including the 4% income tax cess.
To put it another way, investing in ELSS allows you to build wealth over time like any other equity mutual fund. In addition, investment in an ELSS provides tax benefits that no other mutual fund offers.
Start Investing through SIPs
Like all other mutual funds, ELSS can be purchased using a systematic investment plan (SIP). For as little as Rs 500, you can begin a SIP in an ELSS mutual fund. Top-up SIP is accessible for ELSS funds, just like it is for other mutual funds, which means that if your income improves, you can raise your investment amount through SIP top-up.
If you want to earn a complete tax benefit for investing in these funds, you can do so by setting up a monthly SIP of Rs 12,500 rather than putting in Rs 1.5 lakh all at once. The majority of alternative tax-advantaged investment options do not offer a systematic means to invest money regularly.
Shorter lock-in period
When comparing the lock-in period of ELSS to that of other tax-saving investment choices, ELSS comes out on top. Some popular tax-saving investment products, such as PPF, have a 15-year lock-in duration, while ULIPs have a 5-year lock-in period, tax-saving FDs have a 5-year lock-in period, and NSCs have either a 5-year or 10-year lock-in time. In comparison, the lock-in period for ELSS is only three years, giving investors an edge.
Invest while saving
The advantages of equity mutual fund schemes are also accessible through ELSS, which enables you to ride the growth cycle of your ELSS portfolio of companies. In favourable stock market conditions, equity investment can offer higher returns than savings, which can yield around 8%. In a developing economy like India, a well-diversified portfolio of elevated companies might yield better earnings.
Achieve life goals
SIP investing in ELSS promotes discipline and supports the accumulation of a corpus for various life goals, such as purchasing a car, going on vacation, or supporting an emergency. Finally, women may put their money into an ELSS fund and use it to get a step closer to financial independence.
So, with modern investment instruments such as mutual funds increasing popularity among people of all ages, there’s no reason why women shouldn’t give their money a chance to flourish. Taxes are also a key worry for both men and women who work. As a result, investing in a mutual fund scheme such as the top ELSS funds can not only assist women save money on taxes, but it can also result in capital gains.