Make Investments work for your Child.

Alright, so you finally decided to look into this. Great!

Investment Planning for child is crucial for every parent.  There are various stages in child’s development where we need money Day care, Preschool, High school, higher education, etc. The big one is Marriage!

Most parents are under the impression that financial planning for child is a cumbersome task and involves a lot of  planning that involves all of these different stages. And the simple answer is ‘No‘, unlike any other financial planning options this one is not that time-consuming and tough.

The most important part of child investment plan is to cover Education. Every parent want their child to be on top of world, which is fine! Right from preschool till higher studies, parents need to save money to fund their child.

But saving money is not an easy task, the most contributing and dominating factor  is Inflation which reduces the purchasing power e.g what you can buy for 5 lakhs today will cost you 10 lakhs after say 10 years. Regular increase in tuition fees, educational expenses, medical expenses with rising inflation make situation worse.

So, How can you beat this Inflation? Well, be regular,disciplined and focused on your objectives with long-term plan. Remember, the sooner you start, better  you make.

Here are some tips to help you get started:

Start Early:

Investing early with a  long-term view has benefits like  you can start with small amounts because you have a longer period in your hand.

Go Traditional:

Public Provident Fund (PPF) should be your first option for child investment plan. The magic of  “compounding returns” can beat any type of investment in long run. If you save regularly every year in PPF within  prescribed limit,say for 15 years,you can get an awesome amount which can easily fund your child higher education goal. Simple, safe and yet best option which serves your objective more than 50%.


It is a proven fact that equities can outperform over other investments in long run. Investment in some blue-chip companies with long-term view, will sure do the magic. There is a market risk associated with equities but if you are a long-term investor this shouldn’t affect you.


This is must to have kind of thing in any child investment plan. Pure insurance i.e. term insurance is most recommended. Don’t go for any child specific insurance plans as they are very expensive. The actual amount which is invested in such plans is very less (after deducting premium,commissions and administrative charges) and even after completing the term you may not get the expected returns. Remember – Insurance  is for securing your future in case of an any unfortunate event,so go with purpose.

Mutual Funds:

 It’s  a very good option for accumulating wealth for child’s future needs (education or marriage). Invest through SIP in equity and debt funds. Be regular and disciplined with your investments, even your small (regular) contributions can offer descent rewards.


Marriages are incomplete without it :-).  Gold is the most liquid asset. Invest through ETF’ if you do not want to go for Physical gold and its  safe.

Open a Child Saving Account:

As a custom or tradition parents/relatives sometimes give money to child either as a pocket-money or on occasion. Deposit that money in child own account not only helps you but your child can also learn the habit of to saving. Don’t  buy piggy banks 🙂 That money is like taken for granted money and we use it if we run out of cash in a situation.

As Raising the child needs patience, sacrifices over long years so does child investment planning. Eventually, both will fulfill your expectations. Believe me. 🙂

Good Luck!



  1. Great, you have done really good job & your post are benifitial for everyone
    I will suggest to my all freinds .Good luck


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s