ELSS stands for Equity Linked Savings Scheme. These are tax-saving mutual funds that invest at least 65% of their assets in the stock markets. Investments of up to Rs 1.5 lakh in ELSS funds can earn a tax break under Section 80C. The advantage of ELSS funds is that they come with the lowest lock-in among all tax-saving investments-just 3 years. Apart from that, because of their equity exposure, ELSS funds are best placed to help you earn inflation-beating returns over the long-term. Even though these tax-saving mutual funds don't offer guaranteed returns, the best performing ones have generated 12-15% returns over the long-term through the power of compounding interest. Additionally, since ELSS funds are equity-oriented funds, all gains on investments held for over one year are tax-free for the investor.