Dhirendra Kumar explains if it's wise to exceed the 80C limit in ELSS
Can one invest more than Rs 1.5 lakh in an equity-linked saving scheme (ELSS)?
- YVR Vijay
There is no legal restriction on the maximum amount invested in an ELSS, though the deduction under Section 80C is limited to Rs 1.5 lakh only.
I don't see any difference between how a flexi-cap fund and an ELSS works. Initially, I thought ELSS would have a greater advantage because the fund manager gets that money for at least three years and doesn't have to worry about it. But as I see, it has not translated into any meaningful returns. It works for some funds. For some others, it doesn't.
So why unnecessarily lock in your money for three years? Though one should stay invested in equities for at least five to seven years, if a fund goes bad, the fund manager moves out or something; you will be at liberty to move your money.
But if you find an ELSS very attractive for some reason, by all means, go ahead and invest.