If you’re a parent you will definitely think about securing their future. Investing in children's future is gaining traction in India, with more parents and guardians realizing the importance of starting early. There are several investment options available in India for children, ranging from savings accounts to mutual funds and insurance plans. In this post, we bring to you a few popular child investment schemes in India.
6 Children Investment Schemes in India
1. Mutual Funds
Mutual funds are an excellent investment option for parents who want to invest in the stock market for their child's future. Mutual funds provide diversification, which helps to spread the risk and increase the chances of returns. Parents can choose to invest in equity mutual funds for the long term, which can provide good returns over time. Mutual funds also offer tax benefits under Section 80C of the Income Tax Act.
2. Sukanya Samriddhi Yojana (SSY)
Sukanya Samriddhi Yojana is a government-backed scheme designed specifically for the girl child. The scheme was launched in 2015 and offers a high rate of interest. Parents can open an SSY account in the name of their daughter before she turns 10 years old. The account matures when the girl turns 21 years old. Parents can make a maximum of four deposits per year, with a minimum deposit of Rs. 250 and a maximum of Rs. 1.5 lakh. The interest rate on the SSY scheme is currently 7.6% per annum.
3.Public Provident Fund (PPF)
Public Provident Fund is another popular investment scheme in India that parents can take advantage of for their child's future. PPF accounts can be opened in the name of a minor with the help of a parent or guardian. The scheme has a maturity period of 15 years, and the interest rate is currently 7.1% per annum. Parents can make deposits in the PPF account up to a maximum of INR 1.5 lakh per year.
4. National Savings Certificate (NSC)
The National Savings Certificate is a safe and secure child investment option for parents who want to invest for their child's future. NSC accounts can be opened in the name of a minor with the help of a parent or guardian. The scheme has a maturity period of five or ten years, and the interest rate is currently 6.8% per annum. Parents can make deposits in the NSC account up to a maximum of Rs. 1.5 lakh per year.
5. Unit Linked Insurance Plan (ULIP)
A Unit Linked Insurance Plan is a type of insurance policy that combines investment and insurance. ULIPs provide life insurance coverage while also offering investment options. Parents can choose to invest in ULIPs for their child's future, which can provide returns over the long term. ULIPs also offer tax benefits under Section 80C of the Income Tax Act, making them a popular children's investment scheme for parents.
6.LIC Children Investment Plan
Under this scheme, parents can invest regularly for a period of 5 to 25 years and accumulate funds for their child's higher education, marriage, or any other future financial goals. This children’s investment scheme also offers flexibility in terms of premium payment frequency and provides tax benefits under section 80C and 10(10D) of the Income Tax Act. Overall, the LIC Children Investment Plan is an excellent investment option for parents looking to secure their child's future financially while enjoying the benefits of life insurance.
Summing up, investing in a child's future is a crucial decision that parents need to make. India has several children investment schemes that parents can take advantage of to secure their child's future. The above-listed schemes are some of the popular child investment schemes in India that parents can consider for their child's future. It is advisable to consult a financial advisor such as Wisely Invest before investing in any scheme to make an informed decision. For more details, get in touch with us right away!