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Now Invest in top Tax Saver mutual funds of 2024

Tax saver investments are crucial components of financial planning, and mutual funds offer an attractive avenue for individuals seeking both wealth creation and tax deductions. This article explores the various ways to save tax with mutual funds and make the most of the deductions available under the Income Tax Act.

Fund Name



3 Yrs Return

5 Yrs Return


Quant ELSS Tax Saver Fund - Growth - Invest Now

Equity - ELSS



Very High

HDFC ELSS Tax saver - Growth

Equity - ELSS



Very High

SBI Long Term Equity Fund - Growth

Equity - ELSS



Very High

Bandhan ELSS Tax Saver Fund - Growth 

Equity - ELSS



Very High

Bank of India ELSS Tax Saver - Growth

Equity - ELSS



Very High

Motilal Oswal ELSS Tax Saver Fund - Growth

Equity - ELSS



Very High

Nippon India ELSS Tax Saver Fund - Growth

Equity - ELSS



Very High

Franklin India ELSS Tax Saver Fund - Growth

Equity - ELSS



Very High

Parag Parikh ELSS Tax Saver Fund - Growth

Equity - ELSS



Very High

Tax Saver – ELSS – Your Gateway to Tax Efficiency:

Equity Linked Saving Schemes (ELSS) stand out as a tax-saving mutual fund option. Under Section 80C, investors can claim deductions up to Rs. 1.5 lakh on the amount invested in ELSS. These funds, with a mandatory lock-in period of three years, not only help you save tax but also offer the potential for substantial capital appreciation. Invest Now

Features of Tax Saver Funds (ELSS)

Equity Linked Saving Schemes (ELSS) come with distinctive features that make them an attractive investment option, especially for tax-saving purposes. Here are some key features of ELSS:

1.  Tax Benefits:

ELSS funds offer tax benefits under Section 80C of the Income Tax Act. Investors can claim deductions of up to Rs. 1.5 lakh on their taxable income for the amount invested in ELSS.

2.  Equity Exposure:

ELSS funds primarily invest in equities and related instruments, providing investors with exposure to the stock market. This equity component has the potential for capital appreciation over the long term.

3.  Lock-in Period:

ELSS comes with a mandatory lock-in period of three years, which is the shortest among tax-saving investments eligible for Section 80C deductions. Once the lock-in period expires, investors have the flexibility to redeem or continue holding the units.

4.  Market-Linked Returns:

ELSS funds’ performance is linked to the performance of the stock market. While this introduces market risk, it also offers the potential for higher returns compared to traditional tax-saving instruments like fixed deposits.

5.  Diversification:

ELSS portfolios are typically diversified across various sectors and industries, reducing the impact of a poor-performing stock on the overall fund. This diversification helps manage risk.

6.  Systematic Investment Plan (SIP) Option:

ELSS funds often allow investors to invest through SIPs, enabling them to spread their investments over regular intervals. This systematic approach helps in rupee cost averaging and mitigates the impact of market volatility.

7.  Lump-sum Investment Option:

Investors can also choose to invest a lump sum amount in ELSS funds. However, considering the market-linked nature of these funds, a systematic investment approach is often recommended for risk mitigation.

8.  Dividend Payout and Reinvestment Options:

ELSS funds provide investors with the flexibility to receive dividends or reinvest them in the fund. Dividend reinvestment allows for the compounding of returns and increases the potential for higher tax benefits.

9.  Professional Fund Management:

ELSS funds are managed by experienced fund managers who make investment decisions based on market research and analysis. The expertise of fund managers contributes to the overall performance of the fund.

10.  Transparent NAV Calculation:

The Net Asset Value (NAV) of ELSS funds is calculated and disclosed daily, providing transparency to investors regarding the fund’s value. This allows investors to track the performance of their investments.

While ELSS funds offer compelling features, investors must assess their risk tolerance, investment goals, and time horizon before making investment decisions. Additionally, staying informed about market conditions and consulting with financial advisors can help in making well-informed investment choices.

Tips for investing in tax-saver index funds:

1. Performance History

Analyze the historical performance of the tax saver index fund. Look for consistent returns over various market cycles. Past performance doesn’t guarantee future results, but it can provide insights into the fund’s management.

2.  Risk Tolerance:

Assess your risk tolerance before investing. While ELSS tax saver funds have the potential for higher returns, they also come with market-related risks. Ensure that your risk tolerance aligns with the risk profile of the chosen fund.

3.  Systematic Investment Plan (SIP):

Consider using a Systematic Investment Plan (SIP) to invest regularly. This approach allows you to benefit from rupee cost averaging, reducing the impact of market volatility.

4.  Tax Implications:

Understand the tax implications of your investment. While ELSS funds offer tax benefits on the invested amount, be aware of the tax treatment of returns and gains at the time of redemption.

Remember that investing always carries risks, and it’s crucial to make informed decisions based on your financial objectives.


Investing in securities market or mutual funds are subject to market risk. Please read scheme related all documents before investing. Any information mentioned above is not a recommendation. Please do your research before investing in mutual funds. Investing involves risks, and users should carefully consider their financial situation and risk tolerance before engaging in any investment activities. Divadhvik does not endorse or guarantee the accuracy of third-party content or external links provided on the platform.