Tata Tax Savings Fund is managed by Pradeep Gokhale. The Tata Tax Savings Fund is an open ended equity linked tax saving scheme (ELSS) with a compulsory lock-in period of three years. New investors can safely skip this fund. If you have already invested in this scheme, keep a close watch on its performance.
Tata Tax Savings Fund is a large and mid cap fund which invests your money in stocks of large and small sized companies. Presently the fund has 77.73% exposure to large sized companies, 16.14% exposure to mid sized companies and 2.04% exposure to small sized companies. Large cap companies tend to be stable, however mid and small cap companies are not avoided as they provide bumper returns.
- Saving on tax outgo
- Child’s education
- Child’s Marriage
- Planning for retirement
- Home Purchase
- Creation of Wealth
- Short term needs
- Lifestyle needs
If you had invested Rs 1 lakh when the fund was launched in March 1996, your value of investments would be around Rs 4.47 lakhs. If you had invested Rs 1 lakh for 5 years, your value of investments would sadly be around Rs 85,120.The performance has not been similar to other funds in this category. The fund has been giving around -3% returns to those who have stayed invested for 5 years.
Assume you had invested Rs 10,000 every month in Tata Tax Savings Fund through SIP for 5 years today you would have around Rs 7.89 lakhs.
A onetime fee of Rs 100 is charged on investments over Rs 10, 000 made through distributors. If you are a first time investor in mutual funds an additional Rs 50 is charged to cover KYC expenses. This is deducted from your investment and can be skipped if you buy directly from the mutual fund via their website or offices.
No exit load applies for units withdrawn from this scheme. Expense ratio of Tata Tax Savings Fund is 2.86%. This is charged to recover the fund management company’s expenses on securities’ transactions, commissions, registrar fees, etc. Your mutual fund returns will be total returns less expense ratio.
The returns in a mutual fund are absolutely tax free, provided you did not withdraw within 1 year. Tata Tax Savings Fund qualifies for sec 80C ELSS benefits, which means you can invest up to Rs 1 lakh a year in this fund and deduct the amount from your gross total income for computing income tax.