Financial independence is a key aspect of empowerment for women. In India, women increasingly take charge of their financial future and explore investment options that align with their goals.
Equity Linked Savings Scheme (ELSS) funds are an investment avenue with great potential. ELSS funds not only offer tax benefits but also provide an opportunity for women to grow their wealth over the long term.
What are ELSS funds?
ELSS funds are mutual funds that primarily invest in equity and equity-related instruments. They come with a lock-in period of three years, during which investors cannot redeem their investments.
ELSS funds offer potential capital appreciation and tax benefits under Section 80C of the Income Tax Act, making them an attractive investment option for individuals looking to save on taxes while building wealth.
Here are 5 reasons why women should invest in ELSS funds:
Tax benefits:
ELSS funds provide dual benefits to women investors. Firstly, they offer tax deductions of up to Rs 1.5 lakh under Section 80C of the Income Tax Act. By investing in ELSS funds, women can lower their taxable income and potentially save a significant amount of money on taxes.
Secondly, ELSS funds have the potential to generate higher returns compared to traditional tax-saving instruments like Public Provident Fund (PPF) and National Savings Certificate (NSC). Thus, not only do women save on taxes, but they also have the opportunity to grow their wealth over the long term.
Potential for good returns:
ELSS funds have historically provided higher returns compared to traditional tax-saving instruments such as Public Provident Fund (PPF) or National Savings Certificate (NSC). Since ELSS funds primarily invest in equities, they have the potential to deliver returns over the long term. By investing in ELSS funds, women can harness the power of compounding and generate wealth that can significantly impact their financial goals.
Wealth creation:
Investing in ELSS funds enables women to participate in the growth of the stock market. Equities have historically outperformed other asset classes over the long term. ELSS funds provide a convenient avenue for women to tap into this potential.
By investing regularly in ELSS funds, women can benefit from the power of compounding and create substantial wealth over time. This wealth creation can be instrumental in achieving financial independence, fulfilling life goals, and securing a comfortable future.
Flexibility and liquidity:
While ELSS funds have a mandatory lock-in period of three years, they offer greater flexibility compared to other tax-saving options. After the lock-in period, women investors can choose to either redeem their investment or continue with their holdings.
This flexibility allows women to align their investment strategy with their financial goals and adapt to changing circumstances. Additionally, ELSS funds offer the convenience of systematic investment plans (SIPs), allowing investors to invest small amounts regularly, further enhancing liquidity and ease of investment.
Encouraging financial independence:
Investing in ELSS funds empowers women to take charge of their financial well-being and fosters a sense of financial independence. By making informed investment decisions and building a diversified investment portfolio, women can break free from financial dependencies and become more self-reliant. The potential returns from ELSS funds can act as a catalyst in enabling women to achieve their life goals, whether pursuing higher education, starting a business, or planning retirement.
To wrap up
ELSS funds offer a host of advantages for women investors, ranging from tax benefits and wealth creation to flexibility and professional management. By investing in ELSS funds, women can harness the power of equity markets and work towards achieving their long-term financial goals.
