Ans: Considering the investment horizon of a long term (minimum 5 years) for your child’s higher education, it is advised that you invest in large cap equity funds. Axis Bluechip Fund, Parag Parikh Long Term Equity Fund are a few of the given category that you may consider investing in.
Similarly one may ask, what is the best investment account for a child?
A Roth IRA in particular is ideal for children: The contributions your child makes to the account will grow tax-free. Those contributions can be pulled out at any time, and the investment growth can be tapped for retirement, but also for a first-home purchase and education.
Regarding this, where should I invest for my child’s future?
PUBLIC PROVIDEN FUND (PPF)/ DEBT FUND OR FIXED DEPOSIT (FD): PPF is the most popular tax-saving investment plan and long term investment scheme which can be opened in post office or banks. The interest rate on the PPF is market linked now and one can invest up to Rs 1 lakh in a year.
Which plan is best for child?
Best Child Investment Plans
|Plan Name||Entry Age||Maturity Age|
|Sahara Ankur Child Plan||0/13 years||40 years|
|SBI Life – Smart Scholar||Parent- 18/57 years Child-0/17 years||65 years|
|SBI Life – Smart Champ Insurance Plan||Parent- 21/50 years Child-0/13 years||70 years|
|Star Life Bright Child Plan||Parent- 19/45 years Child-0/8,7 years||69 years|
The following schemes are available for a boy child:
- National Saving Certificate (NSC).
- Post Office Recurring Deposit.
- Kisan Vikas Patra (KVP).
- Public Provident Fund (PPF).
- Post Office Monthly Income Scheme (POMIS).
- Ponmagan Podhuvaippu Nidhi Scheme.
Minors may not be able to open their own brokerage accounts, but family and friends can help them set up custodial or guardian accounts, and when a child begins to earn income (for at least one year), they can open an IRA.
Overview of the best investment accounts for young investors
|TD Ameritrade||Advanced trading tools and research|
|Public||Building financial literacy with friends|
One of the simplest ways to get your kids started in stocks is to set up a custodial brokerage account. You’ll be able to transfer existing shares of stock, mutual funds or other securities from your account to the custodial account, or buy specific securities directly within the custodial account.
Get started right away: The sure-fire killer to your goal is delay. While planning for your child’s needs, it always pays to start early. This is because if you start saving and invest early, it will give you a longer time horizon to meet your financial goals (such as child’s education) and even build a bigger corpus.
The Public Provident Fund tends to provide a far superior rate of returns compared to an LIC policy like Jeevan Anand. What you should do is invest in the PPF and take a term policy online, which is cheaper and faster. In the term policy you do not get your money back, but, you are provided with solid insurance.
Sukanya Samriddhi Yojana