Best ELSS vs Best Large Cap Mutual Funds: Where Should Your ₹1.5 Lakh Tax Saving Go?

That ₹1.5 lakh tax-saving limit under Section 80C looms large each financial year. Should it flow into best ELSS mutual funds for dual tax breaks and equity growth, or play safe with best large cap mutual funds? Both shine over 5-year horizons, but risks and rewards differ. Choice India offers commission-free access to these gems, letting every rupee work harder. Let’s break down the top performers and pick winners for your goals.

Top Large Cap Funds: Steady Blue-Chip Growth

Large caps invest in India’s biggest, stable companies—think Reliance or HDFC Bank. Lower volatility suits cautious investors.

Nippon India Large Cap Fund Growth leads at 19.7% 5-year returns. No lock-in, just ₹100 minimum. Perfect for steady SIPs building emergency cushions.

ICICI Prudential Large Cap Fund Growth follows closely with 17.8%. Same zero lock-in, ₹100 entry. Reliable for retirement planning, weathering market dips gracefully.

HDFC Large Cap Fund – Growth delivers 17.1%. ₹100 minimum, flexible exits. Families favour it for kids’ weddings—consistent without sleepless nights.

Canara Robeco Large Cap Fund Growth at 14.0%, and Kotak Large Cap Fund – Growth at 14.8% round out strong choices. All ₹100 starts, no lock-ins. These best large cap mutual funds prioritise capital protection with decent upside.

Top ELSS Funds: Tax Savings with Equity Punch

ELSS (Equity Linked Savings Schemes) offer Section 80C deductions up to ₹1.5 lakh, plus wealth growth. 3-year lock-in trades flexibility for higher potential returns.

SBI LSS Tax Saver Fund Growth tops at 20.9%. ₹500 minimum, 3-year lock-in. Aggressive equity bets suit young professionals maximising tax alpha.

HDFC ELSS Tax Saver Fund Growth scores 21.4%. Same ₹500 entry and lock-in. Balanced portfolio blends leaders and risers—popular for salaried jumps.

Parag Parikh ELSS Tax Saver Fund Growth at 17.9%, DSP ELSS Tax Saver Fund Growth 19.0%, and Motilal Oswal ELSS Tax Saver Fund Growth 19.3% complete the best ELSS mutual funds list. All ₹500 minimums, 3-year holds. Higher returns (17-21%) beat large caps, but expect 15-20% drops in corrections.

ELSS vs Large Cap: Head-to-Head Showdown

Returns: Best ELSS mutual funds edge out (19% avg vs 16.7% for large caps), rewarding patience post-lock-in.

Risk: Large caps dip less (10-15% max drawdowns) vs ELSS (20-30%). Conservative souls pick stability.

Tax Edge: ELSS saves ~₹46,800 tax (30% bracket) yearly—massive headstart. Large caps miss this but allow anytime exits.

Liquidity: No contest—large caps win for emergencies. ELSS demands 3-year commitment.

Minimums: Both ultra-low (₹100-₹500), SIP-friendly for salaried budgets.

Via Choice India among brokerage firms in India, invest direct plans commission-free. Save 1% expense ratios yearly—₹15,000 on ₹15 lakh over 10 years.

Where Your ₹1.5 Lakh Fits Best

Choose ELSS if: Under 40, high tax bracket, 5+ year horizon. Max tax savings + equity growth. Example: ₹1.5 lakh at 20% compounds to ₹3.7 lakh in 5 years.

Pick Large Caps if: Risk-averse, need liquidity, nearing goals. Steady compounding without lock-ins. Same investment grows to ₹3.2 lakh.

Hybrid Hack: Split 50-50. ₹75k ELSS saves tax; ₹75k large cap hedges volatility.

Action Steps with Choice India

Open a free account—PAN, Aadhaar, bank link in minutes. Start SIPs across these best ELSS mutual funds and best large cap mutual funds. Track via app, rebalance yearly. Past returns? No guarantees—markets swing.