Undoubtedly, we are all having a very busy life. So much so, that we have barely time to think of the best suitable investment options for us. It leads to waste of hard-earned money. However, you should know that there are a wide range of investment tools like mutual funds, equities, fixed deposits and government schemes, etc., but where to invest is the question that has most people flummoxed. Each scheme varies from another by providing a whole different set of options when it comes to getting a hefty return on your money.

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There is a scheme, however, which gives even higher returns than the traditional ones, guarantees maximum returns, higher interest rates, lower lock-in period and can even overcome market volatility. It’s like every sort of delicacy has been piled on one plate for you! 

This is an Equity-linked savings scheme (ELSS), which is not only a great tax saving instrument but also creates assured growth opportunity for your investment. 

Archit Gupta, Founder & CEO ClearTax says, "After living on shoestring pocket money during college days, who can blame young professionals (in their initial career phases) for going over the top with spending? This transition from pocket money is, of course, dotted with a hundred alluring things to own with a no-monitored buying power. Eventually, many do wake up gadget-rich and urban-poor – a phase when they tend to start considering investments."

Young folks don’t have the patience or perseverance to wait long for rewards. They want more and that too quickly. Perhaps, this is why, novice investors - mostly young professionals in their 20s and early 30s - are flocking to Equity Linked Savings Scheme (ELSS), adds Gupta.

Here is  what really makes ELSS attractive ClearTax shows the way: 

1. Reasons galore to call it the best tax-saver

Now for salaried people, investments almost always begin with tax-saving. Government allows  you to claim deduction up to Rs. 1.5 lakh from your taxable income if you invest that amount in one or more schemes specified under Section 80C. ELSS, the only mutual fund option in 80C investments, is becoming quite a star, especially due to its historically high returns.

2. Better Returns – Proven Track Record

Everybody wants the best value for his/her money. When you have an option to earn 12% to 15% returns on your money, you wouldn’t opt for 7% to 9%, right? This is exactly how ELSS entices young professionals.

3. Shortest Lock-in than them all

ELSS seems to understand the pulse of new age investors. The lock-in period is only 3 years  while the same is 5 and 15 years for fixed deposit and public provident fund respectively. You can stay invested for as long as you like after that and set short-term or long-term goal accordingly. ELSS being the one that gives ‘more immediate’ outcome is clearly the winner here.

4. SIP option makes it affordable and accessible

ELSS gives young professionals a way to save without having to compromise on their aspirations – and that is Systematic Investment Plan or SIP. Instead of putting a one-time lump sum (which many find difficult to cough up), you can invest monthly a manageable bit of your monthly income through an SIP. It is convenient and way better than keeping it in savings account or worse just spend it all.

5. SIPs to dodge market fluctuations

Watching the market and keeping up with the trends is not everyone’s cup of tea. But that doesn’t mean they should miss out on the benefits of equities that market savvy people enjoy. They attain supreme returns by playing the sharp market game through diversified equity investments and stocks. SIPs help you get close enough, navigating through ups and downs, without getting burned.

6. In case of an unexpected windfall?

Let investments upgrade themselves! You can increase your SIP amount or siphon off a portion of the ‘extra money’ to an ELSS. In fact, many experts recommend putting lumpsum in a liquid fund and then do an STP (Systematic Transfer Plan) to an SIP . It will enable you to reap benefits of liquid funds - higher rates than savings account rates with absolute liquidity – along with that of SIPs.

In conclusion, Gupta says, "it all depends on your investment goals. Young professionals have more earning  years ahead of them and hence can afford to choose ‘riskier’ paths (with high potential for long-term returns)."