According to Girish Kumar, Research Analyst at Share India Securities, Equity Linked Savings Schemes (ELSS) funds are attractive for senior citizens because they invest at least 80% of their assets in equities, which means there’s significant growth potential.
“Senior citizens can also claim a tax deduction of up to ₹1.5 lakh per year,” Kumar noted.
However, he added a note of caution: the mandatory three-year lock-in period can limit liquidity, which might be a concern for those needing quick access to funds.
Top ELSS funds for seniors
Based on their performance over the last three years, the following funds offer good returns with competitive expense ratios (Compiled by Girish Kumar, Research Analyst at Share India Securities):
| Fund name | 3-year return | Expense ratio |
| Motilal Oswal ELSS Tax Saver Fund | 45.56% | 0.65% |
| SBI Long-term Equity Fund | 37.52% | 0.93% |
| HDFC ELSS Tax Saver Fund | 32.13% | 1.08% |
| DSP ELSS Tax Saver Fund | 31.94% | 0.68% |
| Bank of India ELSS Tax Saver Fund | 31.43% | 0.96% |
| Quant ELSS Tax Saver Fund | 30.98% | 0.65% |
| Franklin India ELSS Tax Saver Fund | 30.79% | 0.99% |
| Baroda BNP Paribas ELSS Tax Saver | 29.96% | 0.95% |
| Invesco India ELSS Tax Saver Fund | 29.96% | 0.75% |
| Nippon India ELSS Tax Saver Fund | 29.96% | 1.01% |
Alternative options: Credit risk and balanced advantage funds
For seniors seeking more liquidity or lower volatility, credit risk funds and balanced advantage funds offer viable alternatives.
Anand K Rathi, Co-founder of MIRA Money, suggested considering Kotak Credit Risk Fund and Aditya Birla Sun Life Credit Risk Fund for debt-focused investors.
“These funds provide the potential for better returns than traditional debt funds while maintaining a moderate risk level,” Rathi said.
For seniors open to a small equity exposure, he recommended ICICI Equity Savings Fund and Edelweiss Equity Savings Fund.
“For moderate risk takers, balanced advantage funds like Nippon Balanced Advantage Fund and HDFC Balanced Advantage Fund could offer the right mix of equity and debt,” he said.
Loading…