MoneyRadar

Investing

Lock-in period

A fixed time during which you cannot withdraw your invested money.

A lock-in period is the minimum time your money must stay invested before you can take it out.

Tax-saving products usually have one: ELSS locks for 3 years, PPF for 15, and tax-saving FDs for 5.

Don't put money you might need soon into a locked product, however good the tax break looks.

For example

Invest in ELSS this year and that specific investment can't be redeemed for 3 years, even if you desperately need the cash.

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