BAJAJ ASSET MANAGEMENT LIMITED.
BAJAJ ASSET MANAGEMENT LIMITED.
An ELSS Calculator is a financial tool that helps investors calculate the potential returns and tax savings they can get from investing in ELSS mutual funds. It’s an easy-to-use online tool that estimates how much you could earn based on your initial investment, investment period, and expected rate of return.
An ELSS mutual fund calculator helps you plan your investments effectively and provides clarity on how much tax you can save by investing in ELSS funds, making it an essential tool for tax-conscious investors. However, investors should note: The ELSS mutual fund calculator is an aid, not a prediction tool. It may provide only an indicative picture.
With the help of an ELSS calculator, you can estimate how your investments in an Equity Linked Savings Scheme can potentially evolve over time. Since it is a tax-saving fund, it can also give you a clear idea of how much tax you may save under Section 80C of the Income Tax Act, 1961.
To use an ELSS calculator, you need to enter your investment amount, expected return rate and investment duration. Using these details, the calculator reflects on your probable maturity amount and potential tax benefits over the selected timeframe. While the results are not guaranteed, the tool can be helpful in making an informed decision. A ELSS sip calculator may assist investors in estimating the potential corpus that could accumulate through regular SIP investments in ELSS schemes.
Estimate returns
The ELSS calculator helps you project returns based on your investment amount, duration, and expected returns, allowing for better financial planning.
Simplify tax calculations
It simplifies the process of understanding the tax savings you can achieve through your ELSS investments, helping you optimize benefits.
Future growth visualization
As an online tool, the ELSS Calculator is accessible anytime, anywhere, and helps you visualize your investment’s growth, aiding in informed decision-making.
The online ELSS Calculator works by taking basic details from the investor, such as the amount they plan to invest, the duration of the investment, and the expected rate of return (which can be an estimate based on historical performance). However, past performance may or may not be sustained in the future.
Based on these inputs, the ELSS calculator then calculates the potential returns and shows the final maturity amount. The tool also estimates the tax savings under Section 80C of the Income Tax Act, 1961, for the investor. It’s simple, easy to use, and helps you plan your investment goals by projecting the returns you can expect in the future. A ELSS SIP calculator is useful for investors opting the SIP route.
The formula used in the ELSS Calculator is:
Future Value = Investment Amount × (1 + Rate of Return)^Time Period For example, if you invest Rs. 10,000 per month in an ELSS mutual fund for 5 years at an expected return of 12% per annum, the ELSS Calculator would calculate your potential returns based on this formula. After 5 years, your total investment of Rs. 6,00,000 (Rs. 10,000/month for 5 years) could grow to Rs. 8,24,864 depending on the performance of the fund. This helps you see how much your money could grow, making it easier to plan your financial future.
To use an ELSS Calculator effectively, first input the amount you want to invest, either as a lumpsum or through SIP (Systematic Investment Plan). Then, select the investment duration (the number of years you plan to stay invested). After that, enter your expected annual return rate.
The calculator will give you the projected future value of your investment, including any tax savings. Using this tool helps you visualize how your money will grow over time, making it easier to make informed decisions about investing in ELSS mutual funds.
An ELSS investment does not have a fixed tenure and so it does not mature in the way a traditional investment would. However, the ELSS calculator can help you estimate the potential returns at the end of your chosen investment duration. An ELSS calculator uses factors such as your investment amount, duration and expected return rate to calculate your potential final corpus. If you are investing in ELSS through a Systematic Investment Plan, it is important to remember that each of the monthly investment has a 3-year lock-in period.
The calculator applies power of compounding to give you an approximate maturity value. As with all mutual fund schemes, ELSS potential returns relies on market conditions over time, hence your actual amount may vary from the value shown by the calculator.
Having said that, the calculator can still be a potential tool for you to explore in your financial journey.
Bajaj Finserv AMC’s ELSS calculator can be used for both SIP and lumpsum investments. The examples below elaborate on this:
Using an ELSS calculator for planning lumpsum
Suppose Ms Ananya invests Rs. 75,000 as a lumpsum in an ELSS fund for 5 years. She assumes an expected annual return of 11%. After entering these details into the ELSS calculator, the estimated maturity value comes to around Rs. 1,26,380.
This means that, based on the inputs provided, her investment may grow by about Rs. 51,380 over 5 years. The actual value, however, may differ depending on market conditions and the fund’s performance.
Using an ELSS calculator for planning an SIP
Now, suppose Mr Raj starts a monthly SIP of Rs. 1,000 in an ELSS fund for 3 years. He assumes an expected annual return of 13%. After entering the SIP amount, tenure and expected return into the calculator, the estimated maturity value comes to around Rs. 43,743.
This can give him an idea of how regular monthly investing may build wealth over time. However, the final value will depend on market movements and actual fund performance.
Examples for illustrative purposes only. The calculator is an aid, not a prediction tool. It may provide only an indicative picture.
While ELSS calculators may be useful for planning, it is important to be aware of common mistakes that investors often make:
The calculator is an aid, not a prediction tool. It may provide only an indicative picture.
All ELSS funds come with a mandatory 3-year lock-in period from the date of investment. This is the shortest lock-in among other tax-saving scheme options available under Section 80C of the Income Tax Act, 1961.
When you invest in ELSS, you are eligible for tax deductions of up to Rs. 1.5 lakh under Section 80C of the Income Tax Act, 1961. Other potential returns linked to the scheme are subject to Long-term Capital Gains Tax after the lock-in period.
No, it is not possible for investors to withdraw from an ELSS fund before the mandatory lock-in period of 3 years. Any withdrawals can happen only after this period. If you start an SIP in ELSS, each instalment is treated as a separate contribution and follows its own 3-year lock-in from the date of investment.
An SIP spreads investments over time, while a lumpsum involves investing the full amount at once. The choice depends on your comfort with market timing and finances.
When using an ELSS calculator, the expected rate of return is just an assumption, not a guaranteed figure. It may be practical to compare two scenarios – one with a higher growth estimate (eg: 12%) and one with a lower one (eg: 8%). This may help you get a balanced view of potential outcomes.
No, ELSS investments have a three-year lock-in period. Switching or redemption is not allowed during this time.
The ELSS calculator may help you plan contributions within the ₹1,50,000 deduction limit available under Section 80C of the Income Tax Act, 1961. However, your actual tax savings will depend on your overall taxable income, other eligible investments and deductions, and prevailing tax laws, among other factors. For personalised guidance, it is advisable to consult a financial advisor or tax consultant.
No, ELSS is not tax-free after 3 years. You can withdraw your ELSS investment only after the mandatory 3-year lock-in period, and long-term capital gains tax will apply at the time of withdrawal as per the applicable equity mutual fund tax rules. As on FY 2026-27, LTCG on equity-oriented funds is taxed at 12.5% after an exemption on gains of up to Rs. 1.25 lakh.
However, investments in ELSS can be claimed as a deduction under Section 80C up to Rs. 1.5 lakh in every financial year, subject to the overall 80C limit.
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The calculator alone is not sufficient and shouldn’t be used for the development or implementation of an investment strategy. This tool is created to explain basic financial / investment related concepts to investors. The tool is created for helping the investor take an informed investment decision and is not an investment process in itself. Bajaj Finserv AMC has tied up with AdvisorKhoj for integrating the calculator to the website. Mutual Fund does not provide guaranteed returns. Also, there is no assurance about the accuracy of the calculator. Past performance may or may not be sustained in future, and the same may not provide a basis for comparison with other investments. Investors are advised to seek professional advice from financial, tax and legal advisor before investing in mutual funds.
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Our Investment Philosophy reflects what we, as an organisation, believe will generate a good return on equity investment for our investors in the long term. It dictates our goals and guides decision making.
Alpha (a) is a term used in investing to describe an investment strategy’s ability to beat the market.
Alpha is thus also often referred to as excess return or the abnormal rate of return in relation to a benchmark, when adjusted for risk. Essentially, it means doing better than the crowd without taking disproportionate risk.
Collecting superior information
Analysts and portfolio managers strive to collect superior information about the business and the management of the company. They try to generate superior earnings forecast and the balance strength of the company and the industry, thereby trying to 'beat the market' on information edge. This is an important source of alpha for an investor. However, over the years, retaining the information edge has become more difficult and expensive. With a whole lot of investors trying to collect superior information, how can an investor be sure to continuously have accurate and material information about the companies, ahead of others, all the time?
Processing information better
Even if you don't have material information earlier than the crowd, you can still generate better outcomes if you are able to process this information better. Investors develop models and algorithms with enhanced predictive powers to forecast the next move. Fund managers who invest based on some pure formal analytical models are quantitative managers. Here, the goal is to try and beat other investors based on the sophistication of procedures or analytics. The analytical edge can be quite useful until it gets copied by many, and then it may stop generating superior returns.
Exploiting behavioural biases
As the name suggests, this edge is achieved by superior behaviour in reacting to the inputs available to maximise alpha. Modern finance assumes people behave with extreme rationality. However, researchers in behavioural finance have shown that this is not true. Moreover, these deviations from rationality are often systematic. Behavioural managers try to exploit situations where securities are mispriced by the market because of behavioural factors. At Bajaj Finserv AMC, we endeavour to combine the best of these edges.
