Piggy Banks to Portfolios: Smart Investment Moves for Your Child’s Bright Future

Planning for your child’s future is one of the most important financial decisions you’ll make. With rising education costs and evolving career opportunities, choosing the right investment plan can ensure your child’s dreams are always within reach.

 

Key Highlights:

 

•⁠  ⁠Child Insurance Plans: These offer a combination of life cover and savings, ensuring your child’s goals are protected even in your absence. Options like SBI Life – Smart Scholar Plus and HDFC Life YoungStar Udaan provide market-linked returns and lump sum maturity benefits.

 

•⁠  ⁠Mutual Funds for Children: Equity-oriented funds such as SBI Magnum Children’s Benefit Fund and HDFC Children’s Gift Fund have delivered 12–20% annualized returns, with a 5-year lock-in or until the child turns 18. SIPs can start as low as ₹500.

 

•⁠  ⁠Public Provident Fund (PPF): Backed by the government, PPF offers 7.1% annual interest, tax benefits under Section 80C, and a 15-year lock-in—ideal for long-term goals like higher education.

 

•⁠  ⁠Sukanya Samriddhi Yojana (SSY): Specifically for girl children, SSY offers 8.2% returns with tax benefits and a lock-in until age 21 or marriage after 18.

 

•⁠  ⁠Unit Linked Insurance Plans (ULIPs): Combine insurance with market-linked growth, offering flexibility and tax benefits, though returns depend on market performance.

 

•⁠  ⁠Endowment Plans: Blend guaranteed savings with insurance, suitable for risk-averse parents seeking steady returns.

 

Outlook:

A mix of child-focused mutual funds for growth, PPF/SSY for stability, and insurance plans for protection can create a robust financial foundation for your child. Start early, review your goals regularly, and consult a financial advisor to tailor the best plan for your family’s needs.

 

Source: Policybazaar, SBI Life, Groww, HDFC Life, Edufund, Tata AIA, ICICI Prudential, Forbes Advisor