What Are The Types Of Investments To Secure Your Child's Future?
Updated On Aug 11, 2021
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Planning for a child's future is a difficult challenge for every parent. Being a parent, you wish the best for your child. With rising inflation and changing lifestyle, Child Future Planning is quite a demanding task for every parent. A Child Plan is the opportunity for every parent to plan beforehand towards their child's future and help them fulfill their dreams. Investment towards a child's future can make a big difference in their lives. Child Plans act as a financial tool which children can use against financial disasters in future.
By planning for your children now, you are protecting them in all the important periods of their life from costly education to being independent. These investments will act as a solid foundation in boosting your child's confidence. The sooner you begin saving, the more you can add towards a child's bright future. The more you save and invest will act as a safety blanket for your children during difficult times.
There are a wide array of investment options available in front of you according to your requirements to create a better secured future for your child.
In this article we will discuss some best investment options that you can avail for your child's better secured future.
Types of Investment Options
Following are some of the different types of investment options which you can choose for investing your money -
Mutual Funds or SIPMutual funds or SIPs (systematic investment plans) are one of the best long term investment options wherein one can invest a fixed amount at regular intervals. Investment amount can be as low as Rs. 500 instead of lump sum amounts. Systematic Investment Plans are the mode of Mutual Funds. Under Mutual Funds you have the flexibility to choose among two investment options available such as Systematic Investment Plans and Lump Sum. Benefits are generally greater than investment costs.
Endowment PoliciesEndowment plans are life insurance policies designed to pay a lump sum amount on maturity or on death. Endowment plans come with the dual benefits of life coverage and low risk appetite. These plans provide you with the triple privilege of tax benefit, maturity benefit and life coverage. Endowment Policies are used to deal with financial needs such as children's education, marriage, buying a house,etc.
ULIP ( Unit Linked Investment Plan)ULIP is the most affordable type of investment which offers dual benefits of insurance cover along with an investment. Under ULIPs, one can choose from a wide range of funds to invest in, such as equity funds, hybrid funds, debt funds, etc. ULIPs is an ideal investment solution for long term investment policyholders.
Fixed DepositIt is widely known that compared to a traditional savings bank account, A Fixed Deposit offers a higher rate of interest on capital compared to a traditional savings bank account. Almost every public and private bank offers the Fixed Deposit facility. Availing a Fixed Deposit facility is an easy task. Currently, fixed deposit rates range from 5.75% to 6.75%.
Money Back PlansMoney Back Plans promise you guaranteed returns at regular intervals. Money Back Plans offer you the triple privilege of death benefits, maturity benefits and survival benefits all under a single plan. It also offers you with tax benefits as per the prevailing tax laws along with additional bonuses based on the company performance during the policy tenure. These are non linked traditional plans designed to fulfill educational requirements of your child.
Planning is the process that can help you overcome any hassles. The earlier you plan, the more you can save towards your child's bright future. Money Back Plans, ULIPs, Mutual Funds, Fixed Deposits, and Endowment Policies are some long term investment options that you can avail according to your needs to safeguard your child's future and in order to reach your financial goals.
Also Read: Child Plans Myths Busted
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.