Tax-Saving Mistakes & How to Avoid Them

Every year, from January to March, a frenzy of tax-saving begins. In the rush, many people make costly mistakes that can hurt their long-term financial health. Are you one of them? Here are common errors and how to avoid them.

Mistake 1: Last-Minute Rush

The Problem: Waiting until the deadline forces you to make hasty decisions, often leading you to buy unsuitable products just to save tax.

The Solution: Plan your taxes from the beginning of the financial year (April). A small SIP in an ELSS fund each month is far better than a large, stressful lump-sum investment in March.

Mistake 2: Mixing Insurance and Investment

The Problem: Buying traditional insurance policies (like endowment or money-back plans) for tax savings. These products often provide low insurance cover and poor returns.

The Solution: Keep them separate. Buy a pure term insurance plan for life cover and use dedicated instruments like ELSS or PPF for your **80C investments**.

Mistake 3: Focusing Only on Section 80C

The Problem: Many people think tax saving ends with the ₹1.5 lakh 80C limit. They miss out on other deductions.

The Solution: Explore other options! You can claim deductions for health insurance premiums (Section 80D) and an additional ₹50,000 in NPS (Section 80CCD(1B)).

A **financial planner for tax saving** can help you create a year-round, holistic tax strategy that aligns with your financial goals. Stop the last-minute scramble. Schedule a tax planning consultation today.