Today's youth tries to solve money-related things. Whether it is tax saving or banking. Sometimes people wait for the last time for tax saving and then make a mistake in investing. So choose the right investment option for tax savings. We are talking about some common mistakes in this news that the tex payers often do. Know the obvious mistakes and how to avoid them.
Waiting until the last minute for tax-saving:
Don't wait until the last minute to invest in mutual funds like ELSS for a tax saving scheme. It is also better for FD and PPF to set up their recurring debits at the beginning of the financial year. It is a whole year-long process, and if you wait till the last minute, it may increase the likelihood of taking a wrong decision in haste. Most tax-saving investments are long-term, so it should not be misled or caught in agents' affairs.
Non-claim under Section 80-E:
Interest payment on education loans can be deducted under section 80-E. If you are delaying the payment of this loan, you are also delaying the income tax relief besides increasing your interest burden. Timely payment will reduce the outstanding amount and also improve the credit score.
Non-Essential Insurance Policy:
Many times those who want tax savings buy non-essential insurance policies for tax saving. Don't just shop to save tax, wonder if the investment is really of your use for a long time. Otherwise, you are spending money, not buying investments or anything useful.
Investment because of tax saving:
Tax saving is never seen to be more than the benefits of investment. So assess your risk goals and tenure based on your needs and then choose the investment product and select the option of tax savings as an added benefit in it.
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