Tax Saving Funds are the Best Way to Cut Your Tax
Do you think that you can save tax on your idle money but you did not have proper tax planning? Do you really want to know the way to save tax? We will guide you the most useful tax saving method. There are many ways which can cut your tax. The one of the most useful way is to invest in tax saving funds. Before investment in tax saving funds need to understand about this.
A tax saving fund (also called Equity Linked Savings Scheme (ELSS)), is a mutual fund scheme that invests in equity & equity related securities. It has a lock in period of 3 years. Therefore, investments made in the scheme cannot be redeemed for a period of 3 years.
One should look at the management style of tax saving funds, whether they invest in value or expansion stocks. The biggest benefit of tax saving funds is that it allows investors to choose products according to their risk appetite. Before selecting tax saving funds, ensure that your investment takes into account your risk profile and the generally Asset allocation of your portfolio. These schemes are suitable for investors willing to take a higher risk for Better returns from their tax-saving investments.