Plan your investments wisely and enjoy tremendous tax returns with ELSS calculators

 Equity Linked Savings Scheme or in short, ELSS is a popular tax saving mutual fund and is a type of equity fund that qualifies for a tax deduction of up to Rs.1.5 Lakhs per year. ELSS offers tax efficiency with a lock in period of three years and also tax free dividends for those choosing dividend options. Those invest in ELSS funds gain excellent and substantial tax free returns. It is true that equity linked savings schemes have gained tremendous popularity over other tax saving options for a number of reasons.

ELSS calculators

Systematic investing in Mutual funds (SIP) is the answer to prevent pitfalls of equity investment with the benefit of high returns. The SIP calculator shows how small investments that are made at regular intervals yields better returns over a long period of time.

Advantages of Investing in ELSS:

ELSS is a type of equity fund that helps with tremendous tax deduction annually under the Income Tax Act, Section 80C. There are a number of benefits in investing in ELSS, those are

a.      Lock-in period: An Equity Linked Savings scheme has the shortest lock in period for three years, among all the other tax saving investment options.


b.     High Returns: ELSS is a leading Market linked instrument that offers a higher return than conventional tax saving instruments such as PPF, fixed deposits, National Scheme Certificate and so on.


c.      Taxation: Apart from qualifying for a tax deduction of up to Rs. 1.5 lakh under the section 80C of the Income Tax Act, ELSS offers long term capital gains that are tax free up to one lakh per annum.


d.     SIP Option: The ELSS is the main tax saving instrument that comes with a SIP option. The SIP helps the investors to invest at a very minimal cost along with the benefit of compounding power.


ELSS Calculator:

ELSS is an open ended equity fund that is not just great for tax saving purposes but also creates an excellent growth opportunity for the investment. These schemes are favored by the Government of India to inculcate the habit of long term investment among the citizens. A major portion of the fund in this ELSS gets invested in equities and equity related products. It is mandatory to determine the performance of the investment before investing in that, this is best performed by the tool known as the ELSS calculator.

This calculator is a helpful tool that plays a major role in helping people take the right decision in lieu of choosing the best investments in the ELSS scheme. The tool helps the investors to evaluate the effectiveness of an investment. There are a number of such calculators available for

investors, depending on the type of scheme they choose.

SIP and ELSS calculators

One good protocol to avoid any pitfalls in investing in equities is systematically investing in mutual funds. Such systematic investments serve well with good returns. Even small investments made over the course of time at regular intervals yield good returns over a long time period. That’s exactly the reason why SIP has become one of the popular choices of investments. SIP ensures that both large and small investments that are made periodically are managed by professional managers.

For those interested to invest in mutual funds SIP then it is important to understand the nature of the investment and estimate its net worth at the end of the tenure. Such a figure is best obtained through an ELSS SIP calculating tool. This calculator will project the returns offers by the SIP exactly irrespective of the nature of the funds, be it debt, equity or hybrid funds. The investor has to populate all the relevant details such as the amount of investment, its tenure, expected rate of returns, etc., before using the SIP calculator, to help it generate the estimates rate of return for the investment.

The calculator works based on the input offered by the investor and thus should be considered as an estimate and not as an absolute value. Some factors such as inflation also come to play in determining the maturity value of the SIP. But ultimately, this tool plays a vital role in getting the estimate for an investment tentatively.

Past Performance SIP calculator:

This is a significant tool that offers insights on the historical performance of the SIP. This calculator takes into account certain details such as the amount invested in SIP. Starting and finishing period of the SIP, valuation date, maturity month and year of the SIP, and the name of the asset valuation company. With these details, the calculator will generate the estimate the worth of the SIP investment at the time of the maturity.

Such evaluations are important to determine how fun will perform at different market cycles. The long run performance throws good insight into learning where the fund will head in terms of future prospects. The past performance is not a guarantee to the returns in the future, but they help by showing how the fund will grow in different market conditions including the most adverse ones.

Tax savings with the help of ELSS calculator:

The Indian Income Tax act permits the individuals to have a tax exemption of Rs.1.5 lakhs under the section 80C if they make certain eligible investments. The tools help to calculate the extent of eligible investments that the user has already made in the financial year and the extent of tax that the user can save by maxing out the 80 C limit. This tax saving SIP helps the investor with the top equity linked savings schemes based on the performance of the equity over the course of five years.

Final words:

The ELSS calculator will provide with the estimation of how much the fund is worth or how much the investor will invest every month to reach a certain target. This calculator will shed light on how the fund has fared over the years historically. Neither of the calculators should be taken as an absolute value, as the market conditions will not get factored while calculating.



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