Question 1

Why does PPF beat NSC when NSC pays a higher rate?

Accepted Answer

Because PPF interest is exempt from income tax and NSC interest is not. At the 30% slab, tax takes roughly a third of everything NSC earns, which is far more than the half point of extra rate is worth. At a low slab the gap narrows and NSC can win, which is exactly why your slab rate is an input on this page.

Question 2

Why is Sukanya Samriddhi shown but not recommended?

Accepted Answer

Because it can only be opened for a girl child under ten, so it is not an option most readers can act on. It is shown with its full figures, since it is genuinely the strongest of the four when it is available, but it stays out of the ranking. An option you cannot open is not a recommendation.

Question 3

Why is ELSS not here?

Accepted Answer

Because nobody sets its return. The other four have rates published by the government or a bank, so we can compute them from a source. Putting ELSS in would mean inventing an expected return and then ranking four real schemes against our own guess. Its three year lock-in is the shortest of any 80C option and that is a real advantage, so compare it separately with an assumption you can defend.

Question 4

Does the lock-in matter more than the return?

Accepted Answer

Often, yes. PPF locks money for fifteen years and Sukanya until the child is twenty-one. The top of this table is usually the least accessible option, and money you might need in five years does not belong in either. The lock-in column is there so the ranking is never read on its own.

Question 5

Do these deductions work under the new regime?

Accepted Answer

No. Section 80C is a Chapter VI-A deduction and the new regime allows almost none of them, so nothing here gives you anything on the way in. The schemes still pay their interest and the exempt ones are still exempt, so the comparison of returns holds, but the yearly tax saving does not. Check the old versus new regime page first.

Question 6

What does the roll-forward assumption change?

Accepted Answer

NSC and a tax saver deposit run five years, so over a longer horizon they mature and the money has to go somewhere. This page assumes it is reinvested at the same rate, which is what a tax saving ladder does in practice. If you would spend each maturity instead, both are worth less than shown, while PPF and Sukanya are unaffected because nothing matures until the end.

Best 80C Investment Comparison