Save Tax, Money & Grow Wealth -5 Easy Financial Tips (India)

The Employees are subjected to taxation based on their salary structure. So when we earn more, more  money we are required to shell out in the form of taxes. According to Indian Tax system under the section 80c(financial year 2015-16), an Employee can save up to 1.50 lac's to escape and save tax. There are various different beneficiaries schemes covered under Section 80 C, which can help you save your hard earned income easily and make you wealthier. Following are the 5 easy ways to get more returns by saving under section 80 C and save your Tax.


1) Take NSC  for minimum 5 years

NSC stands for National saving certificates, NSC save you from paying excess tax. They provide you with high interest rates of up to 8.50 %. The interest returned back from this saving will be taxable when you withdraw your total amount after 5 years. Minimum tenure for getting eligible for tax saving under section 80 C is 5 years. Also if you do NSC saving for 10 years, you get little higher interest rates. NSC certificates can be easily made from the post offices and you can make 1.50 lac's certificate to save your self from the entire possible exemption possible under section 80 C.

2) Tax saving Fixed deposit

Many banks provide many different schemes for saving tax in form of saving in tax saving fixed deposit, the minimum tenure necessary is 5 years. You can get interest rates ranging from 7.50% up till 9 % depending upon various banks. You can put up to 1.50 lac's in fixed deposit for saving your tax.


3) Invest in Mutual Funds

Many different banks have different beneficiaries schemes for Wealth growth by investments in Mutual Funds. Investments in the mutual Funds are required for minimum of 5 years for getting tax benefit. You can hire an financial adviser you can put your investments into various different sectors according to the best market conditions. Mutual Funds does not guarantee fix income returns, it can give you returns from as low as 2% to as high as 20 % depending upon the overall market growth and the financial status of the markets. As this involves investments in various sectors by your agent/financial adviser, so it have small risk factor associated with it which does not guarantee you a fixed confirm returns after a tenure of 5 years.

4) Public Provident Fund (PPF)

This scheme is the most popular among middle class as it gives good returns and what gives this PPF an edge from others is that the interest income is tax-free. Minumum period required to put money is for 15 years and extendable.  Withdrawals are only allowed after 7 years.  Yield on PPF will vary and will be fixed at 25 basis point above the 10 year government bonds.

5) Life insurance policy ( LIC )

Life insurance corporation of India has various schemes and policies to save from the excess taxation under section 80c. Any amount that you pay towards life insurance premium for yourself, your spouse or your children can also be included in Section 80C deduction, but if you pay premium paid by you for your parents (father / mother / both) or your in-laws is not eligible for deduction under section 80C. If you are paying premium for more than one insurance policy, all the premiums can be included.


Saving tax up to 1.50 lac's is easy, so try the various options to get the best returns from your hard earned money in the form of interest back after many years.

Do saving...Save your tax...Grow your wealth over the years easily...Keep sharing what you think and share your thought and ideas with us in the comments box...

(This article has been Written considering the Indian taxation system for the financial year 2015-2016)

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