PPF vs. ELSS Calculator
Find the best Section 80C tax-saving investment for your financial goals.
Choosing the Right 80C Investment
Under Section 80C of the Income Tax Act, Indian taxpayers can deduct up to ₹1.5 Lakh from their taxable income by investing in specific instruments. PPF and ELSS are two of the most popular choices, but they serve very different purposes.
PPF (Public Provident Fund)
- Risk: Low (Government-backed).
- Return: Fixed interest (currently 7.1%, reviewed quarterly).
- Lock-in: 15 years (partial withdrawals allowed after 7 years).
- Taxation: EEE (Exempt-Exempt-Exempt). No tax at any stage.
ELSS (Equity Linked Savings Scheme)
- Risk: High (Market-linked equity risk).
- Return: Historical average of 12-15% over the long term.
- Lock-in: 3 years (shortest among all 80C options).
- Taxation: LTCG tax of 12.5% on gains exceeding ₹1.25 Lakh per year.
The Hybrid Approach
Many financial planners recommend splitting your 80C investment between PPF and ELSS. Use PPF for safety and your "debt" component, and ELSS for growth and your "equity" component.
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