Curious about long-term savings
What are the best options for long-term savings?
There are several options for longterm savings in India, including:
1. Provident Fund: Provident fund is a governmentbacked retirement savings scheme. Both employers and employees make contributions, and the accumulated funds earn interest. The contributions and interest earned are taxfree.
2. Public Provident Fund (PPF): PPF is a governmentbacked savings scheme that offers taxfree interest and returns. It has a lockin period of 15 years, but partial withdrawals are allowed after the 7th year.
3. National Pension Scheme (NPS): NPS is a voluntary, definedcontribution retirement savings scheme. The scheme is regulated by the Pension Fund Regulatory and Development Authority (PFRDA). Contributions to NPS are eligible for tax deductions under Section 80C of the Income Tax Act.
4. Equitylinked Savings Scheme (ELSS): ELSS is a type of mutual fund that invests primarily in equity shares. Investments made in ELSS funds are eligible for tax deductions under Section 80C of the Income Tax Act. However, ELSS funds are subject to market risks.
5. Unit Linked Insurance Plan (ULIP): ULIP is a type of insurance policy that also serves as an investment. It allows you to invest in equity, debt, or a combination of both. ULIPs offer tax benefits under Section 80C of the Income Tax Act.
It is important to consider your financial goals, risk tolerance, and investment horizon before choosing a longterm savings option.