Children are the most important asset for parents. Right from bringing the child into this world, nurturing it, providing them the best care possible, imparting values and providing good education and a healthy life, parents leave no stone unturned when it comes to bringing up their children. Future planning for children has to be done on the right terms, keeping in mind monetary aspects plus investment in time and many other significant factors.
Today we have lot of options to invest securely in our children’s future and earn good returns in the long run. The amount invested would yield a sizeable amount when the child attains majority and the funds thus accumulated could be utilized for his higher education, marriage and other long term plans. Wealth creation for these purposes could certainly be achieved with the right investment options, some of which are listed below:
5 best investment options to help you secure your child’s future
1. Investing in long term mutual funds and SIPs:
Investing in equity based mutual funds by considering various risk factors while deciding on funds, will go a long way in wealth creation for the child’s future needs. Pooling in money through systematic investment plans (SIPs) on a monthly basis will allow slow accumulation of wealth. Interests gained on a per year basis will yield very good returns at the end of the SIP term.
2. Investing money in PPF accounts :
This is one of the best and most preferred options for most of the investors as it holds a huge investment duration of fifteen years thorugh which an investor can invest a sizeable amount in his PPF account. The amount invested also has the advantage of being tax free. Investors can invest as low as 500 INR to a maximum of 1.5 lakh INR per annum and earn good returns at the end of the 15th year. The PPF account could also be opened in the name of the child itself or any individual can opt to open an account in his own name.
3. Buying gold :
Investing in gold has for long been the most preferred option, right from homemakers to the progressive, working communities. Investing money by purchasing gold bars and biscuits and exchanging it for money whenever a necessity arises facilitates a good bargain for the amount thus invested. Gold investments could also be utilized for purchasing jewellery at the time of the child’s marriage. Gold prices normally keep growing at a higher rate and downfalls occur rarely. So, this is one of the best options to pool in your money securely.
4. The Sukanya Samriddhi Yojana :
This scheme is a boon for the female child. It was formulated by the government of India and parents can begin investing for their girl child’s future as early as ten years. An investor can save money in this scheme for nearly 14 years and the duration of the scheme calculates to a total of 21 years from the date on which the investment was made. An attractive rate of interest is given to the invested amount, which stands at 9.2 percent per annum and to top it all, this scheme is also tax free, just like the PPF scheme.
5. Buying long term policies :
There are two aspects under this kind of investment. Firstly, buying an insurance policy which would aid in the child’s future education needs is something that most investors look out for. Higher education costs are expensive as on today and are likely to grow steadily in the near future as well. So, better preparation to meet tomorrow’s costs will help in the long run. The second aspect is that of the parents buying policies for life cover for themselves. In case the parents meet an unexpected or unforeseen situation where the child is left alone to fend for himself, a life insurance policy would provide a support system to the affected child.