6 Parameters to Consider for Any Investment Decision
It is said that Death and Taxes are unavoidable. So do consider the tax benefits that the investment product is going to give you. You might also need to consider the taxation part when you redeem the amount or you get your returns at the end of the Investment Tenure.
This is another attribute along with Inflation that needs to be considered while planning for Investment. A few investments gives tax breaks while for a few other investments the redemptions may be tax free which can be advantageous.
For example, ELSS Mutual funds give tax benefit under Sec 80c and when we redeem it after 3 years, the profits generated are tax free.
In the earlier example, we got 3% benefit while investing in Fixed Deposit considering the Inflation. We also need to consider the Taxes to be paid on the entire profit generated.