Don't be fazed by one-year return; ELSS long-term record is robust

Choose them for their strong wealth creation potential and short lock-in period, especially if you remain on the old tax regime, but don't judge them on past-year returns alone

Equity-Linked Savings Schemes (ELSS), also known as tax-saver funds, were once a favourite investment tool for tax-saving purposes. Now, they are gradually losing investor mindshare, despite their potential to create wealth over the long term.

 

Since April 2025, these schemes have seen net outflows of ₹2,888 crore, according to Association of Mutual Funds in India (Amfi) data. A total of 42 ELSS together managed assets worth ₹2.53 trillion as on October 31, 2025. 

ELSS come with a three-year lock-in and invest a minimum 80 per cent of their corpus in stocks. Besides the active fund options, three passive funds have