But, the real trick lies in investing the balance amount that is left after deducting PF, tuition fee and home loan. It could be a blend of the following:

Payment of Life Insurance Premium

If you do not have a life cover as yet then getting one right now could be the best option. In fact, taking an insurance cover should not merely be a tax-saving decision, it should be a need-based decision judged on the basis of what is the best for you and your family. Even in your absence, it ensures a cushioned future for your dear ones to combat any eventuality.

Small savings schemes

These include the public provident fund (PPF) and National Savings Certificate (NSC). They offer a return of around 8 to 8.5 percent and the lock in period15 years for PPF and 6 years for NSC. Their main advantage is that they offer a guaranteed return unlike equity based products but do not forget that they qualify for rebate under Sec.80C.

Equity linked saving schemes

These are basically mutual funds which are specially created to provide tax benefits. As with regular mutual funds there is no guaranteed return but they generate highest returns as compared to other investing avenues. However you can also lose money in a period of falling stock prices as has happened in the first half of 2008. They also have a lower lock in period of 3 years.