Mirae Asset ELSS Tax Saver Fund for Growth Invest Now

One such scheme is Mirae Asset ELSS Tax Saver Fund which is equity linked saving scheme for investors who want to achieve long-term wealth creation and tax benefits as per the provisions of the tax laws.

The Mirae Asset ELSS mutual fund comes in two plans; Regular and Direct Plans and has two variants of Growth and IDCW.

What Is Mirae Asset ELSS Tax Saver Fund?

We are this fund a type of open-ended Equity Linked Savings Scheme (ELSS).

Key Features of Mirae Asset ELSS Tax Saver Fund

It’s useful to recognize the basic organization of the scheme prior to investing.

Who Manages the Fund?

It is being managed by Neelesh Surana who has been looking after the fund since its inception since December 2015.

The fund house describes their investment philosophy as bottom-up, with a search for stock that is trading at reasonable prices with growth potential.

How Does Mirae Asset ELSS Tax Saver Fund Work?

The Mirae Asset ELSS Tax Saver Fund focuses mainly on investing in equity and equity related securities. The fund house claims the scheme will have the flexibility to invest in various market caps, sectors and investment styles.

This is to provide flexibility to the portfolio.

The fund has no limitation with regard to the size of the companies it could invest in; it could include companies within business segments of the market depending on the investment strategy and the opportunities for the investment.

Equity-Focused Investment Approach

The key element of the portfolio is equity.

That will enable the fund to benefit from the growth of corporate earnings and the economy. However, keep in mind that market exposure comes along with that equity exposure as well.

Diversification Across Market Capitalizations

The scheme offers flexibility in terms of the investments made in the scheme across sectors and market capitalization. This diversification can help to lower the risk of relying on a single company and/or industry.

But, with diversification, risk does not go away. A diversified equity fund can have a losing year even if the overall equity investing market is down.

Bottom-Up Investment Approach

The fund house claims to have followed a bottom up value investing approach for growth businesses to operate the scheme.

This enables a focus on the investment process on the individual company, its business prospects, valuations and long term potential.

The concept is straightforward: the portfolio’s focus is on businesses that can provide a great combination of quality, growth and valuation, but aren’t necessarily popular stocks.

Mirae Asset ELSS Mutual Fund and Tax Benefits

Investors option in for the Mirae Asset ELSS mutual fund mainly to avail of tax benefits.

Investments in ELSS can avail the tax deduction under Section 80C, which would be subject to the rules for the section and the investor’s tax regime choice.

The fund house claims that investments in ELSS can help the investors save up to ₹1.50 lakh per year on tax under the old tax regime.

Section 80C Tax Benefit

As per the provisions, an investor can avail eligible investments from ELSS category in the overall category of Section 80C.

Don’t assume that you’ll get ₹1.50 lakh back if you invest it. If you invest ₹1.50 lakh, it does not necessarily mean that you will get back ₹1.50 lakh as a tax refund. The investment can help to lower taxable income (according to tax rules applicable and eligibility).

Also, all the investments and payments for “Section 80C” are subject to the overall limit. Therefore, before you invest for tax benefits only, you should take into account the other Section 80C liabilities that you may have.

Three-Year Lock-In Period

The minimum lock-in period of ELSS funds is three years.

That is, one may not be able to access an ELSS investment before the end of the three years period demanded. Each SIP investment period has a three-year lock-in period for SIP investors.

Assume that you open a SIP of Rs. 20,000/- per month. Your January installment’s deadlock date is different to your February installment’s deadlock date. All the SIP’s is free at once.

The three year lock-in is the shortest of the statutory lock-in of a number of investment options in section 80C but that doesn’t mean that three years is the best holding period of an equity fund.

Important Things to Check Before Investing

The Mirae Asset ELSS mutual fund is a good option for investors. Here are a few factors to consider before picking up on the fund:

Investment Horizon

Are you able to invest for the long haul – three years or more? More particularly, is it possible to be able to hang on to it longer if the market conditions are not favorable when your lock is released?

Risk Profile

The scheme has a Very High Risk rating.

Ensure that the volatility is in line with your financial personality.

Tax Regime

ELSS tax deductions under Section 80C comes into force for the old tax regime taxpayers. ELSS section 80C deduction is no longer a part of the new tax regime.

So, make sure you are aware of the tax regime of which you fall under before investing specifically for tax benefits.

Regular vs Direct Plan

Discuss the expense and services of Regular and Direct Plans.

When you receive intermediary or advisory support within a Regular Plan, be aware of the difference in costs prior to selecting.

Growth vs IDCW

When planning for long-term wealth creation, know what the Growth option is and the nature of them versus IDCW option.

Is Mirae Asset ELSS Tax Saver Fund Suitable for You?

If the investor believes that he should have an exposure to the equity market, can withstand the volatility of the markets and has a long-term investment horizon and would want to perform a study of the old tax regime tax benefits of the Mirae Asset ELSS Tax Saver Fund Regular Plan Growth option, then this might be an ideal choice.

However, don’t choose a mutual fund, solely based on its history of returns.

Begin at the end.

Next consider your attitude to risk.

Next, take into account the investment’s composition.

Last but by no means least, review if the fund is suitable to your portfolio.

This is a much healthier method of investing.

Conclusion

The Mirae Asset ELSS Tax Saver Fund offers investors the benefits of an equity-market exposure and ELSS tax-saving investment.

With a long history of investing in since 2015, the Mirae Asset ELSS mutual fund has performed well in a few extended investment durations.

FAQs

1. What is Mirae Asset ELSS Tax Saver Fund?

Ans) The Mirae Asset ELSS Tax Saver Fund is an equity-linked savings scheme, which has a statutory lock-in period of 3 years and can provide benefits under Section 80C of the tax laws.

2. What is the lock-in period for Mirae Asset ELSS Tax Saver Fund?

Ans) The lock-in period is three years from the respective investment date, which is compulsory. Each SIP installment has a three year lock-in period.

3. Is Mirae Asset ELSS Tax Saver Fund available in a Regular Plan?

Ans) Yes. The plan has Growth and IDCW options and two types of plans, Regular Plan and Direct Plan.

4. Does Mirae Asset ELSS Tax Saver Fund offer tax benefits?

Ans) The investments can be eligible for deductions as per the rules under Section 80C and old tax regime.

5. Is Mirae Asset ELSS Tax Saver Fund suitable for long-term investors?

Ans) It might be advisable for those investors who have a long-term time frame and look for equity exposure and are willing to accept the Very High Risk that this scheme carries.