Hello and welcome to FundooMoney, your 24X7 buddy for all your money matters! Equity linked saving scheme (ELSS) offered by mutual funds can not only help you save taxes but also make your money grow well thanks to the long term growth from equities. This can help you achieve your financial goals such as child’s higher education and your retirement. Stay tuned and we will tell you how to use ELSS as a first step to save for your child’s future needs.
Earmark tax-saving investments for major future needs Early in people’s work life, typically a significant portion of investments are tax-saving investments like ELSS. It is always a smart move to earmark these investments for your future needs like child’s higher education. For instance, if you invest Rs 10,000 per month in an ELSS for 18 years, and it grows at 12 per cent annually, you accumulate Rs 70.50 lakh.
Supplement ELSS investment with increase in income As your income increases over time, you can increase your ELSS investment amount or invest in other equity funds performing consistently over one, three and five years. In this way, you can create a mutual fund portfolio for your child’s future.
Thus, tax saving investments in the form of ELSS can be a great first step towards saving for your child’s future needs like higher education.
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