4 Best Investment Plans For Kids

For every parent, children are their world. They try and do everything to give them the best, and especially when it comes to their education and future. For providing a better life and better education, saving and investment become their top priority. The rising cost of education is known to everyone, and thus people wish to invest their savings in the investment plans to get the compounded sum at the end.

Indian parents are always concerned about their child’s education and money required for their marriage. Parents start planning for their children right from their birth and think about the best investment plan they can choose to secure their child’s future.

There are many investment plans available in the market. Let’s take a look at few of them.

4 Best Investment Plans For Kids

4 investment plans for kids

1.Fixed Deposits

If you are looking for safe and secured investment plan with an assured return, then you should go for Fixed deposit investment plan. Fixed deposits can give you assured returns and at better interest rates. This investment plan does not get influenced by the market fluctuations.

You can get the flexibility of repayment tenor to suit your financial needs. You can easily take an FD for your long-term investments which will yield you higher returns as compared to the short-term investments. It is much easy to withdraw or close your existing FD if you need money for an emergency situation.

2.Sukanya Samriddhi Scheme

Sukanya Samriddhi Scheme is an Indian government initiative to encourage saving for a girl child. Under this scheme, you can open an account from the time of birth till she is of 10 years of age. It is a scheme which can help you to accumulate savings for your child’s education and future.

This scheme provides you with an interest rate of 8.4 percent. This scheme gives you a tax benefit mentioned under Sec 80C of the Income Tax Act. If you have a girl child and you are planning to save for her marriage or education, then you can opt for this scheme.

The account matures in 21 years, and before which the funds cannot be withdrawn. The only issue that you can face with this scheme is its interest rate which gets revised from time to time affecting your returns.

3.Gold Investment

For your child’s future needs, you can invest in gold. Investment in gold does not mean the physical purchase; it means opting for Gold Exchange Traded Funds (ETFs). There is no locker or any storage charges associated with ETF.

You can invest in them through electronic mode without worrying about theft. The best way to invest in gold is to invest in small amounts each month or every year, making it a big sum later.

For a long-term investment, gold is considered better than any other investment as the return are comparatively higher. To get decent profits, you need to hold the investment for around 10-15 years. The risk involved in gold prices has always been a worry for investors, but considering the previous time, gold has always performed well in the market.

4.Equity Mutual Funds

Mostly, people often go ‘wow’ with equity mutual funds for generating wealth for their children. However, this investment does carry certain risk with it, which is subject to matter as per the market conditions.

Many equity mutual funds have now started giving returns more than the bank returns. For a long-term investor, this investment scheme suits best as it can offer returns that no other instrument can give if invested for long term.

If you are planning to save money for your children’s future needs, then you can look for investing in equity mutual funds. You must know that your overall returns could reduce as they depend on the market conditions.

The Bottom Line

Now when you know much about the investment plans, you can opt for any of the plan to secure your child’s future. Usually, people feel safe to go for Fixed deposits as they are secure and gives assured returns at the end of the tenor. The flexibility of choosing the tenor also makes it a favorable instrument amongst all.

Also Read: Complete Guide to Investing

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