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Mutual Funds Investment India Online - Build Wealth & Save Tax

Are you looking for a good investment this year? Something that will give you better than inflation rates, and not lock up your money for the next decade?

Save twice over by investing in mutual funds. Under Section 80c, certain investments under mutual funds will not only build your wealth, they will also allow tax deductions.

You don’t need much to invest in mutual funds, minimum monthly investment amounts can be as much as Rs. 5000, or as little as Rs. 500. There are many types of mutual funds and your portfolio will depend on your risk appetite, your needs, and what sort of savings you are hoping for.

For many banks, an IFSC code and id proof is all you need. Sign up, for example, with Bank of Baroda with IFSC Code investing is so easy!

What Are the Benefits of Mutual Funds?

  • Economies of Scale: Unlike individuals, mutual funds buy and sell in bulk. This reduces the cost of transaction which would otherwise be uncomfortably high for individuals. You can diversify at lower costs by investing in mutual funds.
  • Divisibility: One of the smaller problems that individuals don’t realise when investing in securities is that buying round lots of securities can be too expensive for regular investors. Mutual funds investment can take advantage of the fact that they have a lot of investors to give low minimum investment costs to their investors and buy round sums of securities.
  • Diversification: Investors will typically choose a range of stocks in order to minimise risks. For instance, there are some commodities which will typically give steady returns but at high cost, and there are risky stocks that may give high returns or very low returns, and there are debt related stocks that will give steady but low returns. By purchasing mutual funds, instead of analysing each stock individually, you can simply choose a suitable mutual fund and let the fund manager make the micro decisions.
  • Liquidity: In general, investors in mutual funds have the advantage of being able to liquidate their investments fairly quickly, sometimes within three business days.

Whether you’re investing in Bank of Baroda using IFSC code, or using a different mutual fund house, these are all advantages you should keep in mind.

Tax Benefits of Choosing Mutual Funds

ELSS funds or Equity Linked Savings Schemes offer deductions of tax of up to Rs. 1.50 lakh in the 80C Section of the Income Tax Act. ELSS funds are diversified equity funds, typically with a lock-in period of 3 years which is one of the shortest periods available.

Using, for example, Bank of Baroda with an IFSC code, this could be an excellent choice for wealth building.

  • Savings made in ELSS schemes are entitled for deduction from taxable income in the 80C Section of the Income Tax Act.
  • Declared dividends under scheme ELSS during the period of investment are tax-free.
  • Additionally, the incomes on the selling of ELSS units are considered as long-term capital gains and are not taxable.

The Two Main Ways To Invest In Mutual Funds:

  • Systematic Investment Plan (SIP) in ELSS: Investments of small amounts monthly which will allow a build-up of a reasonable amount over the years.
  • Invest a lump sum amount at any point of time.

Types of Mutual Funds Available

Before investing with ICICI or Bank of Baroda with IFSC code, know what types of mutual funds you have as options.

  • Equity based funds: Mutual funds that are primarily invested in equity stocks or securities. These typically are very volatile and are best as long-term investments. These can be very good in order to save on tax.
  • Debt based funds: These are mutual funds that primarily invest in debt instruments and are very low-risk. They also, however, give fairly low returns.
  • Hybrid mutual funds: These provide a balance of debt and equity funds and may be fairly risky or safe, depending on the underlying securities.

What Mutual Funds Can You Have With Bank of Baroda, IFSC Code?

Nearly a hundred variations of mutual funds are available with Bank of Baroda, using your IFSC code, and some ID. You can choose any of them depending on what you feel your needs are. Some of the highest rated funds available are

  • Baroda Treasury Pioneer Advantage Direct Fund: This has two fund types, growth and dividend and is a very high rated fund. It has a 3 year return rate of 8.88%.
  • Baroda Pioneer Liquid Direct Fund: This has growth and dividend options with daily dividend and weekly dividend. It has a 3 year return rate of 7.58%. It has a Rank 2 in Crisil’s Liquid category.
  • Baroda Pioneer Credit Opportunities Fund: This has a 3 year return rate of 10.94% and is highly rated.

There are plenty of Bank of Baroda funds with IFSC code you can invest in, and with a careful check on your investment needs, you can build wealth and save on tax with it.

There are also plenty of other banks other than Bank of Baroda where you can use their IFSC code and invest in. Choose your favourite mutual funds and begin your SIP today to make money!

 

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Wednesday, 24 July 2019

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