If it is your first time and you are planning to invest in ELSS, it gets important that you acquire some information first. It is crucial to know what can go wrong and what is right. Mutual funds have always been a choice for investors but it is also true that lack of information can land the investors in tricky situations.
You know Equity-Linked Savings Scheme (ELSS) is the funds that are
multi-cap equity investments. It has a
lock-in period of three years. These funds get you tax advantages coupled with
wealth creation opportunities. Under the realm of Section 80C of the Income Tax
Act, investors can claim a tax exemption of up to Rs one point five lakh on the
contribution made towards ELSS funds. Come on, if you are worried about how
to invest in ELSS, it is simple.
You know taking into consideration various ELSS funds available; picking
the appropriate one for investment could turn out to be overwhelming at times. Generally,
investors pick the fund that gives them finest return over a given investment
horizon. However, there are certain
things that you might want to see or take into mind before you invest. After
all, every investor wants the fund that promises them utmost effective and
outcomes. There are some important and basic things that you should know about
ELSS funds. Have a look below:
Evidence of Identity (KYC)
Any type of investment in mutual funds demands the investor to be
KYC compliant. It is something that stands true for ELSS also. It is important
for the investor to cater a proof of address and also proof of identity, in-person
verification also has to be finished before investment.
Submission of forms
Investments in ELSS could be
made directly via Piggy, Asset Management Companies or even that of direct Mutual Fund app houses or
indirectly via a bank, broker or mutual fund advisor. An investment application form can be fetched from
the official website or can be downloaded from the mutual fund site and requires
be duly filled and submitted to the mutual fund company. The investors have to
be really careful with all the fillings of the forms.
Methods of investment
Investors can do investment in an ELSS through either in a lump sum
or via a proper and Systematic Investment Plan (SIP). It is important to know
that a SIP deducts a prearranged amount from the investor’s bank account occasionally
to invest in an ELSS. Of course, it is better to know about these things before
you start investing. The more you know before you make an investment, the
better it would be for you to take decision regarding investments.
An idea about amounts
Investments in ELSS could be as low as rupees five hundred and there
is no upper limit to do investment. Even though there is no upper restriction to
investment a maximum deduction of Rs. 1.5 lakh are going to be available on the
income of investor, or the amount got invested, whichever is lower.
Conclusion
Thus, these are a few of the many things that can help you get
started with your ELSS investment.
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