ELSS વર્સેસ PPF

ELSS શું છે?

When it comes to building wealth, most investors are after three things: solid returns, consistency, and a chance to save on taxes. While there are plenty of investment options out there, many of them come with a catch—the returns are taxed under regular Income Tax rules.

That’s where ઈએલએસએસ funds step in. Equity Linked Savings Schemes (ELSS) are a kind of mutual fund that not only invests in stocks but can also offer tax-saving benefits. Basically, they give you a shot at growing your money and reducing your tax burden at the same time.
 

PPF શું છે?

Public Provident Fund (PPF) stands out as a long-term investment option preferred by individuals looking for stable and relatively high returns. One of the main goals for those opening a PPF account is to ensure the safety of their principal amount. Once their PPF account is set up, investors are provided with a dedicated PPF account, allowing for regular monthly contributions and the benefit of compounding interest over time.
 

Key Features of ELSS (Retain things to know about section)

Safe Investments: Opting for PPF ensures relief from the uncertainties of investment risks. PPF, being a government-backed scheme, features an interest rate that is determined and paid by the government of India. This government guarantee establishes PPF as a secure investment choice for all Indian citizens.

ગેરંટીડ રિટર્ન: PPF એ સરકાર દ્વારા સમર્થિત પહેલ છે, પરંતુ રોકાણ પર રિટર્ન સુનિશ્ચિત છે, જોકે અપરિવર્તનશીલ નથી. સરકાર દર ત્રિમાસિકમાં PPF માટે વ્યાજ દર નક્કી કરે છે. ઐતિહાસિક ડેટા PPF વ્યાજ દરોમાં 12% થી વર્તમાન 7.1% સુધીનો ઘટાડો સૂચવે છે. હાલમાં, પીપીએફ વ્યાજ દર નાણાંકીય વર્ષ 2022-23 (જુલાઈ-સપ્ટેમ્બર)ના બીજા ત્રિમાસિક માટે 7.1% પર સેટ કરવામાં આવે છે.  

પીપીએફ લૉક-ઇન સમયગાળો: પીપીએફ મુખ્યત્વે રોકાણકારો માટે યોગ્ય છે જેઓ વિસ્તૃત સમયગાળા માટે પોતાના ભંડોળ કરવાની ઇચ્છા ધરાવે છે. આ યોજનામાં 15 વર્ષનો પરિપક્વતા સમયગાળો છે, જે દરમિયાન સતત પાંચ વર્ષ યોગદાન પૂર્ણ કર્યા પછી માત્ર આંશિક ઉપાડની પરવાનગી છે. લૉક-ઇન સમયગાળા (15 વર્ષ) પછી, રોકાણકારો પાસે 5 વર્ષના બ્લૉકમાં અનિશ્ચિત સમયગાળાને વિસ્તૃત કરવાનો વિકલ્પ છે.  

Tax-exemption: PPF falls within the EEE (Exempt-Exempt-Exempt) category of Income Tax implications. This means that contributions of up to Rs. 1.5 lakh in PPF qualify for deductions under Section 80C of the Income Tax Act. Furthermore, the interest earned on the principal amount, along with the maturity amount, is exempt from taxes. This serves as a compelling reason for individuals to consider PPF as a viable investment option.
 

Key Features of PPF (Retain things to know about section)

ફંડ રિટર્ન: એક ફંડ પસંદ કરતા પહેલાં, તેની પ્રતિસ્પર્ધીઓ અને બેંચમાર્ક સાથે તુલના કરીને તેના પરફોર્મન્સનું મૂલ્યાંકન કરો જેથી તે ભૂતકાળમાં સાતત્યપૂર્વક આગળ વધી ગયું છે કે નહીં. જ્યારે કોઈ ફંડ હંમેશા ટોચ પર હોઈ શકતું નથી, ત્યારે ઉચ્ચ-ગુણવત્તાવાળા ફંડ સામાન્ય રીતે લાંબા સમય સુધી ટોચના ક્વાર્ટાઇલમાં હાજરી દર્શાવે છે.    

Financial parameters: Additionally, you may evaluate a fund's performance by considering various parameters such as standard deviation, Sharpe ratio, alpha, and beta. Funds with higher standard deviation and beta indicate higher risk compared to those with lower values. Opt for funds exhibiting a higher Sharpe ratio.   

એસઆઈપી અથવા લમ્પસમ: ઇએલએસએસમાં રોકાણ કરતા પહેલાં, એસઆઈપી અથવા લમ્પસમ દ્વારા રોકાણની પદ્ધતિ નક્કી કરવી મહત્વપૂર્ણ છે. SIP પદ્ધતિ સાથે, તમે નિયમિત અંતરાલ પર નિશ્ચિત રકમ ઇન્વેસ્ટ કરો છો, સામાન્ય રીતે માસિક. તેના વિપરીત, લમ્પસમ પદ્ધતિમાં એક જ ટ્રાન્ઝૅક્શનમાં નોંધપાત્ર રકમનું રોકાણ કરવું શામેલ છે. સામાન્ય રીતે, એસઆઈપી મોડને ઘણીવાર પસંદગીના વિકલ્પ તરીકે માનવામાં આવે છે કારણ કે તે ખર્ચ સરેરાશના લાભનો લાભ લે છે. આનો અર્થ એ છે કે જ્યારે માર્કેટ ડાઉન થાય ત્યારે તમને વધુ યુનિટ પ્રાપ્ત થાય છે અને જ્યારે તે ઊપર હોય ત્યારે ઓછી યુનિટ હોય છે. જો કે, જો તમારી પાસે વધારાની રકમ હોય, તો તમે લમ્પસમ ઇન્વેસ્ટમેન્ટ અભિગમ પણ પસંદ કરી શકો છો.  

Growth & Dividend Options: As an investor, you have the choice between growth and dividend options. With the dividend option, you can receive regular income through dividend payouts for the entire duration of your investment in ELSS. If you opt for the growth option, there are no dividend payouts; instead, the dividends are reinvested in the fund to acquire more units and promote capital growth. Reinvesting dividends enhances the નેટ એસેટ વેલ્યૂ (NAV) of the units, contributing to increased profits for the investor, particularly during favourable market conditions.
 

ELSS વર્સેસ PPF: A Detailed Comparison (Retain the table)

અહીં ELSS વર્સેસ PPF વચ્ચેની તુલના કરી છે:

Eligibility for ELSS Vs PPF

Eligibility Criteria for ELSS

પીપીએફ માટે પાત્રતાના માપદંડ

ઈએલએસએસ: Pros and Cons of Investing

ELSS, or Equity Linked Savings Scheme, is a popular tax-saving mutual fund that offers potential market-linked returns with a short lock-in period. While it offers attractive benefits, it is essential for investors to understand its advantages and limitations before investing. 

Here's a quick look at the pros and cons of ELSS investments.
 

Pros of ELSS

Pros of ELSS (Equity Linked Savings Scheme):

• Eligible for tax deduction up to ₹1.5 lakh under Section 80C
• Shortest lock-in period among tax-saving options (3 years)
• Potential for high returns through equity market exposure
• Low entry point with a minimum investment of ₹500
• Option to invest via SIP for disciplined investing
• Diversified portfolio reduces risk compared to direct stock investments
• Ideal for long-term wealth creation
• No upper limit on investment (only ₹1.5 lakh eligible for tax benefit)

Cons of ELSS

Cons of ELSS (Equity Linked Savings Scheme):

• Returns are not guaranteed due to market fluctuations
• Involves higher risk compared to fixed-income options like PPF or FD
• Lock-in period of 3 years restricts liquidity
• Performance depends on fund manager’s expertise and market trends
• Tax is applicable on long-term capital gains (LTCG) above ₹1 lakh at 10%
• Not suitable for very conservative or short-term investors
• Difficult to predict returns at the time of investment
• Past performance doesn’t guarantee future results
   

PPF: Pros and Cons of Investing

PPF, or Public Provident Fund, is a government-backed savings scheme historically known for its safety and guaranteed returns. It is a popular choice for long-term investors who are seeking tax benefits and capital protection. 

Here's a brief overview of the key pros and cons of investing in PPF.

Pros of PPF (Public Provident Fund):

• Backed by the Government of India, ensuring high safety
• Offers guaranteed, fixed returns, revised quarterly
• Entire maturity amount (principal + interest) is tax-free
• Eligible for tax deduction up to ₹1.5 lakh under Section 80C
• Long-term investment with a 15-year lock-in encourages disciplined saving
• Partial withdrawals and loans allowed after a few years
• Attractive interest rates compared to traditional savings accounts
• Useful for retirement planning and secure wealth accumulation

Cons of PPF

Cons of PPF (Public Provident Fund):

• Long lock-in period of 15 years limits liquidity
• Returns are fixed and may not beat inflation over time
• Maximum investment capped at ₹1.5 lakh per financial year
• Not suitable for short-term financial goals
• No option for joint accounts or early closure (except under specific conditions)
• NRIs and HUFs are not eligible to open new accounts
• Limited flexibility compared to market-linked instruments like ELSS
• Interest rates are subject to periodic revision by the government
   

ELSS અને PPF માં ઇન્વેસ્ટ કેવી રીતે કરવું?

When comparing ELSS and PPF, ELSS funds are a type of mutual fund that are eligible for tax deductions under Section 80C. ELSS funds are offered by various Asset Management Companies (AMCs). PPF accounts, however, can be opened through banks, often at the same branch where you maintain your savings account.
 

ELSS વર્સેસ PPF: તમારે શું પસંદ કરવું જોઈએ?

Choose ELSS for higher returns and tax savings if you're comfortable with market risks. Opt for PPF if you prefer safety and steady, tax-free returns. A mix of both can offer a balanced approach to growth and security in your investment portfolio.
 

તારણ

Choosing between ELSS and PPF depends on your financial goals and risk tolerance. If you seek higher returns and can understand market risks, ELSS are ideal for long-term wealth creation. On the other hand, if safety, guaranteed returns, and long-term savings are your priority, PPF is a more suitable option. 

Investors can also consider a balanced approach by investing in both, combining growth potential with financial security. Ultimately, your investment decision should align with your risk profile, time horizon, and financial objectives.