Top 10 Equity linked mutual funds tax saver funds to invest before last tax saving date March 31
Equity linked mutual funds are mutual fund schemes that invest predominantly in equities, provide tax benefit under Section 80C up to Rs 1.5 lakh and come with a lock-in period of three years on the investment made.
Time is running out for those who want to invest in a tax-saving mutual fund plan, also known as a share-linked savings plan The last date to save taxes for the 2021-22 tax year is March 31, 2022, and if you haven't completed tax planning yet, you need to hurry. By investing in Equity linked mutual funds, you can not only save taxes, but also allow your money to participate in the growth potential of the stock. Equity linked mutual funds are mutual fund schemes that invest predominantly in shares, provide Section 80C tax benefits up to Rs 1.5 lakh and come with a three-year lock-in period on the investment made. But is it the right time to invest in Equity linked mutual funds? With markets still high even after a reasonable correction in recent months, changing interest rate dynamics may hamper the upward movement of equity prices. But, this and other factors that affect share prices should be taken in stride. In the long term, stocks tend to rise.
Show this! Since February 2019, the market is up almost 16.75%, all this even after the March 2020 stock market crash. Equity linked mutual funds investors in February 2022 whose lock-in ends this month after investing in February 2019 they have the option to redeem or continue as an open scheme.
Additionally, for those investors who had invested in February 2016, through February 2019, the index was up 14.50% and up nearly 15% in February 2022.
It shows that despite intermittent volatility, equity indices tend to move higher over the long term.
Over the past 1 year, 3 years, 5 years, and 10 years, the Equity linked mutual funds category has generated returns of approximately 23%, 19%, 14.5%, and 15.45%, respectively. If your Equity linked mutual funds scheme has not been able to beat the market or its peers, it is time to review and take appropriate action.
The best part about Equity linked mutual funds is that the lock works to the benefit of the investors. Markets may not stay up forever, and one may find a 3-year yield on the downside. In such a case, it is better to continue and wait for the market to rise before redeeming.
The best or best Equity linked mutual funds MF scheme may not remain the best at all times. The winning scheme of today may not even remain among the top ranked schemes in 3-5 years. Therefore, choosing the best fund based on short-term performance is not the correct way to select schemes for the portfolio.
When selecting the right Equity linked mutual funds schemes, be sure to look at their long-term performance and choose any fund that performs consistently. Also, most importantly, look at your sector allocation to avoid duplication. Having 2 schemes with similar allocations to industries like Finance, Technology and Construction may not help much
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