Get Maximum Returns with ELSS & Understand the ELSS Return Calculator

Get Maximum Returns with ELSS & Understand the ELSS Return Calculator

With your hard-earned money, finding the right investment vehicle becomes a top priority. Equity Linked Savings Scheme (ELSS) allows you the twin benefit of steady capital appreciation and tax savings. In this article, we will see how to maximise your returns with ELSS and understand the ELSS calculator.  

What is ELSS?

ELSS is a mutual fund that primarily invests in equities or stocks. The ELSS portfolio typically allocates around 65% of its assets towards equity or equity-linked shares, with the remaining portion invested in fixed-income securities.

ELSS is specifically designed to help individuals save taxes under Section 80C of the Income Tax Act 1961. You can get a deduction benefit of up to Rs 1.5 lakh by investing in this scheme, resulting in annual savings of approximately Rs 46,800. However, it is essential to note that this tax benefit is only applicable if you choose the old tax regime.

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ELSS comes with a three years lock-in period, which means you can only redeem your lumpsum investment after that time. For ELSS investments made through the SIP, each installment of the SIP is treated as a separate investment with its own lock-in period of three years.

The lock-in period of ELSS is the shortest among all tax-saving investment options under Section 80C.

What is ELSS Return Calculator?

The ELSS Return Calculator is a dynamic tool designed to estimate the potential returns on your ELSS investments. By inputting specific variables such as the investment amount, duration, and expected rate of return, this tool provides a comprehensive overview of what you can expect regarding financial gains.

One of the significant perks of using the ELSS Return Calculator is its ability to offer personalized insights. You can obtain accurate projections tailored to your unique circumstances by customising the variables according to your investment preferences.

How does the ELSS Return Calculator work?

The underlying principle depends on the power of compounding. It considers the effect of reinvesting dividends and capital gains, thereby maximising your returns over time. The online calculator represents the investment's estimated returns by accounting for these variables.

Here's a step-by-step guide to using an ELSS calculator:

  • Step 1: Enter the investment amount you are considering for ELSS.
  • Step 2: Input the investment duration or time period you plan to stay invested.
  • Step 3: Provide the expected rate of return or growth rate you anticipate.
  • Step 4: Click on the calculate button or execute the calculation.
  • Step 5: The ELSS calculator will generate an estimate of the potential returns

How to get maximum returns with ELSS?

1. Start early

When investing, time is your greatest ally. An early start allows you to take advantage of the power of compounding. Even small monthly investments can accumulate into a sizeable corpus over time.

2. Stay Invested

By staying invested in ELSS longer, you can maximize your returns through compounding. Compounding enables you to earn returns not only on your initial investment but also on the accumulated gains. By remaining invested, your returns have more time to compound and grow exponentially. Moreover, a longer investment horizon allows you to weather market fluctuations and take advantage of the potential growth of equities over time. 

3. Invest more

Whether you are employed or a business owner, it is common for your income to grow as you gain experience and upgrade your skills. To make the most of this increased income, you may want to increase your investments in ELSS proportionately. When you invest more money, it has the potential to generate higher returns over time. By increasing your investment, you can use compounding on a larger scale, as your initial investment and subsequent gains grow together. This can lead to accelerated growth and enhanced returns.


While ELSS may seem less attractive under the new tax regime, it still holds the potential to help you achieve your financial goals. ELSS offers returns typically higher than bank fixed deposits or government bonds. However, evaluating other options that can supplement and enhance your investment portfolio is crucial. Since ELSS is primarily equity-focused, consider diversifying your investments by allocating some of your funds to debt instruments. This can offset market risks and provide stability to your overall portfolio.

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