Childrens Day 2025: Ensuring your kids have a solid financial future is one of the top priorities for every parent. Education, weddings, and other major expenses down the line will need a good chunk of money. That’s why it’s crucial to diversify your investments across different plans to make sure you have the funds ready when you need them. In India, there are plenty of investment options aimed at securing children’s futures. If you’re considering putting money into a plan for your child, Children’s Day is a great time to kick things off. Let’s break down these plans in a straightforward way.
Sukanya Samriddhi Yojana (SSY)
This initiative was introduced by the government specifically to safeguard the future of girls. Parents or guardians can set up an account in their daughter’s name if she’s under 10 years old. The account matures after 21 years or when the girl gets married (after turning 18). This scheme offers an annual interest rate of 8.2%, compounded yearly, until 2025. You can deposit a minimum of Rs 250 and a maximum of Rs 1.5 lakh each year. Plus, it provides tax benefits under Income Tax Section 80C.
Public Provident Fund (PPF)
PPF is a long-term government-backed investment plan that’s known for being safe and dependable. It currently has an interest rate of 7.1%, which the government adjusts quarterly. The interest you earn is completely tax-free, and the investment also qualifies for tax deductions under Section 80C. With a lock-in period of 15 years, it’s perfect for long-term goals like funding your children’s higher education.
National Savings Certificate (NSC)
NSC is a secure fixed-income scheme with a tenure of 5 years, offering interest at a fixed rate periodically. The interest earned is reinvested each year and is eligible for tax deductions under Section 80C. This scheme is a solid choice for accumulating safe capital for your children’s education.
Unit-Linked Insurance Plan (ULIP)
A ULIP is a financial product that combines insurance with investment advantages. Part of your premium goes towards insurance, while the rest is allocated to stocks or bonds. There’s a 5-year lock-in period, and since returns are tied to market performance, there’s a bit of risk involved. Additionally, this plan provides tax benefits under Section 80C. It’s crucial to be aware of the associated fees and risks before you invest.
Mutual Fund SIP
With a SIP, you can set aside a specific amount every month to invest in a mutual fund. This approach helps you develop a consistent investing habit and enables your wealth to grow over time thanks to compounding. As Adhil Shetty, CEO of Financial Express BankBazaar.com, states, “Equity mutual funds can yield better long-term returns, making them ideal for objectives like funding your children’s education. Although SIPs typically aren’t tax-exempt, putting money into ELSS funds (Equity Linked Savings Scheme) is a good option.”
Desclaimer: For any financial invest anywhere on your own responsibility, Times Bull will not be responsible for it.
