Satish asked here in a comment and I quote
I am 24yrs and would like to invest money which would help me to save tax & get good returns. I am planning to invest 30,000 in ELSS through SIP. How and what do you suggest? Do I first buy for 20,000 and then 1000/month or…? Also what do you think about Can robeco, Sundaram tax saver & quantum tax saver? What should I see, dividend or return before investing?
After suggesting Best Tax Saver Funds on the basis of dividend this is the questions of many readers of my blog asked as to what they should choose, Dividend or Return and so I thought I would write on this and clarify it to an extent I could.
Objective of your investment
You should focus on the objective of your investment. When I do investment in Tax Saving funds My prime objective is to Save Tax and secondary objective is ofcourse to gain some money. So if my prime objective is to save tax I should see how can I save maximum tax with minumum investment. I do so by getting my dividend back which I can use elsewhere.
Now is getting dividend the only objective. The answer is No and so I choose the best Dividend fund and invest in the ones with highest returns among them. Remember that funds give Dividend if they have good returns and if you see the list of best dividend funds you would hardly see any fund which has not given good returns but yes there is no conception without exception and Sundaram Tax Saver Fund is very good when it comes to Return but not when it comes to dividend.