Tax-saving advantagesA mutual fund investment also provides tax-saving benefits to investors. If you invest your money in mutual funds such as equity-linked savings schemes (ELSS) then you will be eligible to get tax-deduction benefits under Section 80C of the Income Tax Act, 1961. As per the Income Tax Act, a mutual fund investor is permitted to have tax deduction benefits up to the amount of Rs.1,5000. Hence, when you invest in such tax-saving schemes you will get the benefit of not paying income tax for the amount of money that you have invested in the mutual fund scheme. In this way, such investments will bring down your taxable income.

So, these are some of the advantages of investing in mutual funds. Mutual funds are indeed better than other investment options since most of the benefits are exclusive and help the investors gain high returns with less risk. However, since mutual funds are subject to market risks, choose funds that are suitable according to your risk appetite and take guidance of the experts before investing.