New Delhi. Now that time of the year is going on when people have started making efforts for their tax savings. Everyone tries to save maximum tax. In such a situation, many people invest in such tax saving schemes which are not right for them. It is just like you buy something just because it is getting a good discount but in reality it is of no use to you.

In such a situation, you should understand that just saving tax is not enough. However, tax savings are also necessary, but for this you should not invest anywhere without thinking. It means to say that you do not have to invest for tax savings rather it should be a part of your investment plan.

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Where do people go wrong
Every year it is seen that as soon as January comes, people start hurrying for tax savings. Many people are aware of the investment options under section 80C, 80D, 80E, 24B for tax savings, but still they fail to invest tax savings according to their financial goals. First you should understand your financial goals very well. After this, planning for investment keeping them in mind, then your goal will also be fulfilled and it will also result in tax savings.

Which type of investment option to choose
Before choosing an investment option for tax saving, it should be checked whether you really need it or not. Under section 80C, you get the facility of tax deduction on EPF contribution, children’s tuition fees, home loan payment, life insurance premium etc. Apart from this, you also get tax deduction on the insurance cover. If the tax savings option under section 80C is not enough for you, then you can think about the rest of the options.

How to set financial goal
You should set a financial goal keeping in mind your financial needs in the coming times. Like children’s education, marriage, home loan etc. On the other hand, considering the retirement planning, if the PF contribution to the retirement corpus is less, then you can increase it. This will give you tax exemption under section 80C. Apart from this, additional tax benefit is available on investment of Rs 50 thousand every year in NPS. This can help you in your retirement planning. You will also get additional tax exemption on this.

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