New Delhi, April 29 -- A client once rushed to buy an insurance policy in March, only to realise later that it neither met her needs nor provided optimal tax benefits. Sounds familiar?

From January to March every year, towards the end of the financial year, chartered accountants and tax consultants are bombarded with the same question - where should one invest to reduce tax liability? Often, the advice is to invest in tax-saving mutual funds, life insurance and health cover.

People, specifically the salaried class, are always under the notion that such investments can help save taxes. However, with this mindset comes poor investment decisions and, at times, even a higher tax outgo due to haphazard last-minute planning.

Evolution of ded...