As 31st March nears, it is the last time to save tax for this financial year. Thankfully, there are various tax-saving instruments available in the market and one can invest in these instruments as per one's risk appetite. However, to become a smart tax saver, you need to think beyond tax saving only.

As 31st March nears, it is the last time to save tax for this financial year. Thankfully, there are various tax-saving instruments available in the market and one can invest in these instruments as per one’s risk appetite. However, to become a smart tax saver, you need to think beyond tax saving only. Your every investment should be made keeping in view a certain financial goal.

Here are 7 best tax-saving solutions which will not only help you in saving tax, but will also help you in achieving the financial goals of your life.
Public Provident Fund

The amount contributed, interest earned and the maturity amount all are tax-free if you invest in PPF. With its EEE benefit, the instrument has become one the most well-known tax-saving options. Withdrawals from PPF are allowed from the 7th year from the date of opening the account. However, anyone can avail a loan from the 3rd financial year after the account is opened. The maturity period is 15 years, which can be further extended for 5 years. If planning for retirement, it is one of the best instruments. The interest rate is compounded annually while investing in PPF. You can open a PPF account in a post office or any registered bank.
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Senior Citizen Savings Scheme

A citizen above the age of 60 can open an account under this scheme. Age relaxation is given for those who is on superannuation or on VRS. In such a case one can open one’s account at the age of 55 years. A joint account can also be opened with a spouse in any number of capacity. Investments made under the scheme can be claimed under section 80C, which has a lock-in period of 5 years. Interest is payable quarterly in SCSS.
Equity Linked Savings Scheme

By investing in ELSS, you can save tax up to Rs 1.5 lakh under section 80C of the I-T Act. Also, no tax is imposed on long-term capital gains made through this fund. It has the minimum lock-in period of 3 years, and it also provides the maximum return as compared to other products. However, returns are market linked. Therefore, market and economic conditions do play an important role in deciding the annual returns achieved by making investment in ELSS funds.

Fixed Deposits

A secure rate of return with tax benefits makes fixed deposits one of the most popular investment options. You will get a tax deduction of Rs 1.5 lakh under Section 80C of the I-T Act in a particular financial year. Tax-saving bank FDs also have a minimum lock-in period of 5 years, which means that you cannot withdraw from the tax-saving FD until the maturity period. This instrument is mostly suited for individuals who want an assured return and have a low risk-taking profile.

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Term deposit

Investments made for 5-year term deposits will only qualify for deductions under 80C of the I-T Act. The account can be opened by an individual. Moreover, there is no limit to open a term deposit account. The account can also be transferred from one post office to another as per the investor’s comfort. In case a minor wants to operate his account of TD, he needs to be above the age of 10 years. There is no upper limit for making deposits in a TD account. Here, interest is payable annually but calculated quarterly.

National Pension Scheme

One can get an additional income tax benefit of Rs 50000 for contribution towards NPS under Section 80CCD(1B). To avail the tax deduction benefit, the investment has to be made in Tier I account of NPS only. There is no upper limit on making investments to an NPS account. However, an individual will get the tax benefit of only up to Rs 50000, which is above the section 80C limit of Rs 1.5 lakh in a particular financial year.
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Health Insurance

Health insurance is an important solution for saving tax. Tax deductions can be claimed under section 80D of the I-T Act 1961. According to this section, the deductions are made towards policies on self, spouse, children & parents, whether dependent or not.

Under this section, a maximum deduction of Rs 60000 and minimum deduction of Rs 25000 can be made in respect to the premium paid by any mode other than the cash option. However, if payments are made against health checkups, then in such a case you may include the cash option.