Tax saving mutual funds: Equity Linked Savings Scheme or ELSS Mutual Funds are considered to be the best investment tool, which gives market commensurate returns to the investors as well as saves income tax. Under Section 80C of the Income Tax Act, an investor can claim income tax benefits on investments up to Rs 1.50 lakh in a financial year. So if you want to save income tax along with great returns, then these tax saving mutual funds can be a good option for you. Union Long Term Equity Fund – Direct Plan is an example of this. The fund has given excellent returns to its investors since its launch on January 2, 2013.
SIP calculator: During the last one year, investors of Systematic Investment Plan (SIP) through Union Long Term Equity Fund have got an absolute return of 10 per cent and 5.36 per cent per annum. In the last two years, the fund has given 31 per cent annualized and 34 per cent absolute returns. In three years these returns have been 25.50 per cent and 45 per cent respectively.
According to the data obtained from the Value Research website, if an investor had invested Rs 10,000 every month in this scheme, then after a year it would have become Rs 1.26 lakh. The same investment made 3 years ago would now have increased to Rs 5.20 lakh. If an investor had reposed faith in this fund 7 years ago, today his return would have increased to Rs 14.55 lakh.
1 lakh in 3 years 1.72 lakh
This tax saver mutual fund has given great returns to the investors who invest in lumpsum. If an investor had invested Rs 1 lakh in this scheme at the very beginning i.e. on January 2, 2013, then this amount would have increased to Rs 3,22,500 today, while in 5 years this amount would have been Rs 1.98 lakh today. If an investor had invested Rs 1 lakh in this mutual fund scheme 3 years ago, it would have become Rs 1.72 lakh today and Rs 1.23 lakh in the last one year.
There are some other ELSS funds as well, which have given great returns to the investors. These include IDFC Tax Advantage (ELSS) Direct, PGIM and ELSS Tax Saver Direct, Quant Tax Plan Direct.