ELSS is the only kind of Mutual Fund that is covered under the ambit of section 80c
• Tax-saving FDs
Interest rate - 7-8%
Lock-in period - 5 yrs
This is a special scheme provided by banks & post offices. It is to be noted that, though the contribution towards this scheme is deductible, the returns earned attract tax liability.
• National Saving Schemes(NSC)
Interest rate - 6.8%
Lock-in period - 5 yrs
NSCs are introduced by post-offices where you can avail a deduction of Rs 1,50,000 but the interest receivable is not subject to TDS.
• Home Loan
If u have housing loan, section 80c offers these benefits:
Interest: Whatever interest you pay for the loan, you can claim tax deduction fr up to Rs 2 lakh under section 24.
Also, the EMI paid against loan is tax deductible under sec 80c fr up to Rs 1.5 lakh.
• Sukanya Samriddhi Yojana
Interest rate - 8.4%
Lock-in period - till the girl turns 21 yrs of age
There is an exemption for the lock-in period. Partial withdrawal is allowed when the girl turns 18.
• PPF
Interest rate - 7.9%
Lock-in period - 15 yrs
Available to all Indian citizens either in their own name or on behalf of a minor, contribution to PPF is eligible for deduction under section 80c.
• EPF
Interest rate - 8.1%
Lock-in period - 5 yrs
Here, the employer’s contribution is not eligible for deduction under section 80c
• Infrastructure bonds
These long-term government-backed securities also fall under the ambit of this section’s deductions. The only condition to consider is that the exemption can be availed only for investments above Rs.20,000.
• Senior citizens saving schemes
Interest rate - 7.4%
Lock-in period - 5 yrs
Backed by the government, this senior citizen savings scheme can be availed by a senior citizen with a minimum investment of Rs.1,000.
• National Pension Schemes(NPS)
Returns - 9-10%
Lock-in period - until the age of 60
NPS is a voluntary pension scheme set up by the govt. It helps an investor to save for his retirement pension.
• ULIPs
Interest rate - 7-9%
Lock-in period - 5 yrs
ULIP, like LIC plans, is a combination of Investment & Insurance. The premium paid for ULIP attracts tax benefits under section 80c.
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Fundamental analysis is carried out to find the intrinsic value of a stock and that is the building block of value investing.
Value Investing is nothing but an investment strategy of picking undervalued stocks and by undervalued stocks we mean, a stock that is trading at a price lower than its actual value.
Investors who don't want to invest in physical real estate can buy REITs (real estate investment trusts). These are trusts usually owned by hotel chains and real estate giants.
Investors can even reinvest the dividends to grow their investment portfolio.
2️⃣. Buy Rental Properties
Buying and renting out an investment property can go a long way in improving one's income. This type of real estate investment offers a high ROI in terms of rent.
Even the best of funds tend to have a few bad quarters. That is why it is always better to focus on 3 to 5 yrs returns on mutual funds to evaluate them effectively.
If your equity MF is yielding lower than an index fund, then you are earning negative yields on your market risk which does not make sense.
There are occasions when the fund returns have been too volatile that defeats the purpose of MF investing.