Mutual Funds, Fixed Deposits & Tax-Saving – What’s the Best Strategy?

I’m trying to get a clearer picture of how to manage my investments better, especially when it comes to Mutual Funds, Fixed Deposits (FDs), and Tax-Saving options in India. I thought I’d start a discussion here to learn from your experiences and insights.

🟢 Mutual Funds:

I've been investing in SIP mutual funds (mainly equity and hybrid) for a while now. I like the long-term growth potential, but with market volatility, it does get nerve-wracking sometimes.
I’ve heard about ELSS (Equity Linked Savings Scheme) for tax-saving under Section 80C, but I’m unsure if it’s better than PPF or FDs from a stability standpoint.

Any recommendations on the best-performing ELSS funds in 2025? Or is it better to stick to diversified mutual funds?

🔵 Fixed Deposits:

I’ve always liked FDs for their security and fixed returns, especially in uncertain markets. However, the interest is fully taxable, which eats into the returns.
Now, with FD interest rates hovering around 6–7%, is it really worth locking in funds, or would short-term debt mutual funds offer better post-tax returns?

Also, are Tax Saver FDs (5-year lock-in) a good idea for conservative investors?

🟡 Tax-Saving Strategies:

I’m trying to optimize my 80C limit (₹1.5 lakh per year). I already contribute to EPF and life insurance. That leaves some room. I’m debating between:

• ELSS

• PPF (Public Provident Fund)

• NPS (National Pension System)

• Tax Saver FDs

What’s your preferred mix for tax-saving and wealth creation? I know ELSS has a 3-year lock-in (shortest among them), but is it really better over the long term?