NPS vs PPF vs ELSS — Best Tax-Saving Investment Compared
CardKhoj Editorial Team 13 min read12 March 2026
Financial Disclaimer
Disclaimer: This information is for educational purposes only. Always consult a certified financial advisor before making any financial decision.
Section 80C: Which Investment Gives Best Returns?
You get ₹1.5 Lakh deduction under Section 80C. The three most popular instruments — NPS, PPF, and ELSS — offer very different risk-return profiles. NPS gives an additional ₹50K deduction under 80CCD(1B).
NPS vs PPF vs ELSS
| Feature | NPS | PPF | ELSS |
|---|---|---|---|
| Expected Return | 8-10% | 7.1% (Guaranteed) | 12-15% (Historical) |
| Lock-in | Till 60 | 15 years | 3 years |
| Tax on Maturity | 60% tax-free, 40% annuity | 100% tax-free (EEE) | 10% LTCG above ₹1.25L |
| Risk Level | Low-Medium | Zero | Medium-High |
| Extra Deduction | ₹50K (80CCD-1B) | No | No |
Best Strategy
Age 25-35: ELSS (₹1L) + NPS (₹50K) for maximum returns + extra deduction. Age 35-50: PPF (₹50K) + ELSS (₹50K) + NPS (₹50K). Age 50+: PPF (₹1.5L) for guaranteed, tax-free returns.