Here are six tax-saving schemes to grow your wealth

Equity Linked Savings Schemes (ELSS)

Equity Linked Savings Schemes, commonly known as ELSS, are referred to as the open-ended-equity-linked mutual funds, which apart from saving taxes also helps an individual expand his/her wealth.

As compared to the traditional fixed deposits, ELSS can give higher returns over the long term as the investments are made in equity or stocks.

ELSS has the lowest lock-in period of three years as compared to other tax saving schemes mentioned in the Section 80C.

"ELSS investments also allow you to contribute small monthly sums rather than a lump sum amount at one time. Make sure that you choose the right funds and do review them regularly," Bankbazaar.com  said in a report.

Public Provident Fund

Public Provident Fund (PPF) scheme was introduced for the middle class as the deposits required are very low, cost-effective and affordable. The PPF accounts are tax-free, can be accessed easily, and are simple to understand.

Under the Section 80C, the interest earned as well as the maturity proceeds of the PPF investments are tax free.

An individual can invest in a PPF scheme either through a bank or a post office. The scheme has a lock-in period of 15 years and can be extended by 5 years.

"Traditionally, an individual cannot withdraw money from a PPF account. However, it does provide some liquidity under certain conditions," according to a Bankbazaar.com report.

5-Year Bank Fixed Deposits

These fixed deposit schemes are mostly similar to the regular fixed deposits except that these come with a lock-in period of 5 years.

Bank fixed deposits offer higher interest rates with a maximum cap on investment at Rs 1,50,000. However, the downside of taking up this scheme is that it doesn't offer liquidity.

"You cannot withdraw money from your account, not even by paying a penalty. Above this, the interest you earn every year is fully taxable. Though it is a low-risk investment, the returns from a 5-year bank FD is lower as compared to other investment options," Bankbazaar.com report said.

National Savings Certificate

An individual can claim up to Rs 1,50,000 in tax benefits by investing in an NSC through a local post office. In an NSC scheme, the interest rates are fixed every quarter and are linked to government security rates. These rates vary depending on the lock-in period of your investment.

The interest earned on NSC investment is fully taxable and can be re-invested in the same scheme. However, if the total amount invested crosses the Rs 1,50,000 mark after adding the interest post re-investment, the individual will have to pay tax on the additional amount.

National Pension System

The National Pension Scheme, offered by the government of India, is a good investment option for a retired personnel looking to invest his/her money safely and get assured and attractive returns. It is open to anyone from 18 to 60 years of age.

The scheme offers two kinds of accounts, Tier 1 and Tier 2 account. It serves as a tax-saving investment as well as a good source of income after an individual after the retirement.

The Tier 1 account are is a basic retirement pension account which is available to all citizens. It is a non-withdrawal account. A Tier-2 account is a voluntary savings account through which you can withdraw your savings.

Pension Funds

Pension funds could be another attractive investment scheme which could help both save taxes as well as save up on money. It is of two types – Deferred Annuity and Immediate Annuity.

Deferred Annuity Plan – An individual has to invest annually until they reach retirement. After retirement, he/she can withdraw up to 60 percent of the accumulated amount. The remaining amount can be re-invested in an annuity fund which will provide a monthly pension.

Immediate Annuity Plan – An individual will have to invest a huge sum of money at one time and start getting the monthly pension from the subsequent month onward. This plan is ideal for investing your entire retirement corpus.