Investment Options to Secure Your Children’s Future

As a responsible parent, you need to secure your children’s financial wellbeing. Without proper planning, you may not be able to meet the goals that you have set for your children’s future. Even if you are saving or keeping money aside, you may be unable to make the most out of it. Therefore, it becomes essential to invest in the right financial products that can help you earn substantial returns in the long run. 

Online investment platforms enable you to invest in instruments, like equity stocks and mutual funds, but it could be risky if you do not have any prior knowledge about them. When, where, and how to invest are questions that may arise in your mind. Do not worry, as we are here to guide you with the list of the most promising investment options that can help you in safeguarding your children’s future.

  1. Unit-Linked Insurance Plan (ULIP)

ULIP is one of the most popular wealth creation tools available in the market today. It offers the dual advantages of life insurance and investment. Here, the premium that you pay is utilized to provide cover for life insurance and for investment in equity, debt, or hybrid funds, as per your risk appetite. Investing in ULIP can help you earn approximately 10-12% of returns over a long duration. ULIP is a long term investment, and staying invested for 10-15 years will help you to get the benefits of compounding. The premium paid towards the policy and the maturity benefit are entirely tax-free. You can opt for ULIPs that specially focus on your children’s financial future.

  1. Systematic Investment Plan (SIP)

SIP is one of the noted investment options. It allows you to invest money in periodic intervals. It is advisable to stay invested for 10-15 years, as you earn from the power of compounding. The money is invested in mutual funds, wherein you can earn a respectable amount on maturity. Therefore, the income earned can help you meet the financial objectives that you have in mind for your children. 

  1. Public Provident Fund (PPF)

PPF is one of the most trusted investment alternatives because of the tax benefits and investor-friendly features. It is a perfect long-term investment if you wish to earn risk-free returns. PPF is a retirement scheme where any Indian citizen can invest periodically for a mandatory lock-in period of 15 years. The rate of interest offered by PPF is approximately 7.10%. The amount earned on maturity is tax-free and can be helpful to secure your children’s financial future.

  1. Term insurance

Term insurance is a life insurance policy that can help you secure your family’s financial future if you are not around. Besides this, it will help your family to meet financial goals, like your children’s schooling, their higher education, and wedding, among others. 

  1. Sukanya Samriddhi Yojana(SSY)

SSY is an investment option for the girl child. You can open an SSY for your daughter until she turns ten years old. In this scheme, you can invest a minimum of INR 1,000 to a maximum of INR 1.5 lakh every year for 15 years. This scheme’s maturity period is 21 years, and the returns are tax-exempt under Section 80C of the Income Tax Act, 1961. Besides this, the scheme allows you to withdraw funds partially after your daughter turns 18. You can utilize this money for her education. 

If you are planning for your children’s welfare, it is advisable to compare the features of various investment plans. Doing this will help you ascertain which investment option will be fruitful for securing their financial future.