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Business News/ Money / Personal Finance/  Best 9 ELSS Mutual Funds to buy in 2024; check here

Best 9 ELSS Mutual Funds to buy in 2024; check here

Best 9 ELSS Mutual Funds to buy in 2024 : ELSS stand as a favoured investment choice for tax savings under Section 80C of the Income Tax Act. They provide a dual advantage of tax savings along with the potential for wealth creation.

Best 9 ELSS Mutual Funds to buy in 2024Premium
Best 9 ELSS Mutual Funds to buy in 2024

Best 9 ELSS Mutual Funds to buy in 2024 : Considering the tax implications is essential when making investment decisions. Failing to grasp the tax ramifications of your investments can have a substantial impact on your overall financial health. This clarifies why certain investors opt for placing their funds in equity-linked savings schemes (ELSS) to not just build wealth but also benefit from tax savings. Unlike most tax saving schemes like the Public Provident Fund (PPF), National Savings Certificates (NSCs), etc., these funds invest in stocks.

Under Section 80C of the Income Tax Act, individuals can claim a tax deduction of up to 1.5 lakh in a financial year by investing in specific instruments, including ELSS investments. Investors often express a strong interest in leveraging this section's benefits as soon as their first salary is credited. If you're aiming to reduce your tax liability this financial year, consider initiating investments in these tax-saving mutual funds.

Investing in an ELSS entails a lock-in period of three years, during which selling your investments is not allowed. However, additional investments can be made at any time. Additionally, any income and profits realized after three years will be treated as long-term capital gains (LTCG) and taxed at a rate of 10 per cent if the investment or return value surpasses 1 lakh.

Given the abundance of ELSS funds available, investors often face a dilemma when attempting to determine which investment would not only maximize their earnings but also contribute to tax savings. While numerous factors influence the selection of ELSS funds for investments, a significant number of investors tend to rely solely on the past 10-year returns when making their choices.

Name of the fund house

Name of the fund

10-year returns (in %)

Quant Mutual Fund

Quant Tax Plan


Bank of India Mutual Fund

Bank of India Tax Advantage Fund


Bandhan Mutual Fund

Bandhan ELSS Tax saver Fund


DSP Mutual Fund

DSP Tax Saver Fund


JM Mutual Fund

JM ELSS Tax Saver Fund


Kotak Mahindra Mutual Fund

Kotak ELSS Tax Saver Fund


Invesco Mutual Fund

Invesco India ELSS Tax Saver Fund


Canara Robeco Mutual Fund

Canara Robeco ELSS Tax Saver Fund


SBI Mutual Fund

SBI Long-Term Equity Fund


Source: AMFI (As of November 30, 2023)

Many investors, particularly those new to equity investing, often find investing in ELSS funds to be a common and effective approach. With their tax-saving advantages and obligatory lock-in period, ELSS funds offer a great entry point for venturing into equity investments and cultivating the discipline of long-term investment commitment.

Here’s how ELSS funds can assist novice investors in overcoming typical challenges:

Mitigate concerns about market volatility: The compulsory lock-in period dissuades investors from making hasty decisions influenced by short-term market fluctuations. This encourages them to adopt a long-term perspective and concentrate on the potential for sustained.

Encourage consistent investment: Consistent investments via systematic investment plans (SIPs) assist investors in developing the habit of regular investing, a critical aspect for compounding and accomplishing long-term financial objectives.

Harness the power of compounding: The potential of compounding can yield remarkable results over an extended duration, and initiating investments early in ELSS funds can substantially enhance overall returns by maximizing the compounding effect.

Access equity exposure: The ELSS funds offer investors an opportunity to gain exposure to the equity market, enabling them to explore the potential for higher returns in comparison to conventional fixed-income instruments.

Tax advantages: Investments in ELSS come with tax benefits under Section 80C of the Income Tax Act, offering an extra incentive for investors.

As investors develop confidence and familiarity with ELSS funds, they frequently find themselves at ease exploring other equity schemes. The exposure to equity and the favourable returns from ELSS funds can motivate investors to delve into more diversified equity portfolios that align with their risk tolerance and investment objectives.

For individuals new to the realm of investing, ELSS funds act as a valuable entry point, allowing new investors to embrace equity investing, surmount common challenges, and potentially enjoy the benefits of long-term wealth creation. The amalgamation of tax advantages, compulsory lock-in, and exposure to equity renders ELSS a valuable instrument for constructing a robust financial future.


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Published: 01 Dec 2023, 11:49 AM IST
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