What are children’s funds


All parents concern about their children's future

Secure your child’s future with the Children’s fund

Every parent dreams of building a secure and stable future for their children. They know that the needs of their children increase as they grow up. It will not be possible for parents to support them financially to fulfill their needs without proper planning. But most of them do not know how to give them a financially secured future. If you do not yet start saving for your children, it is not too late. Now you can invest in children’s funds to secure their future. By investing in mutual funds, you can collect sufficient funds for your child’s education, career, or marriage and make them financially secure.

What is a children’s fund?

All parents concern about their children’s future and look for different investment options to secure their future. Most parents consider the education, profession, and marriage of their children are the most important goals for investing. But their aspirations also change with the growing financial and economic opportunities in the country. Here comes the importance of children’s funds. It is a kind of mutual fund with specific goals to secure a child’s future.

Children’s funds are popular investment options for many parents to plan for the future of their children. The reason is that it is a solution-oriented mutual fund plan. These mutual fund plans can meet the rising cost of education and other basic expenses of children. A great attraction of these funds is that it invests in both debt and equity portfolios. As an investor, you can opt for an equity-based or debt-based investment based on your time horizon and risk appetite.

Most of the child plans come with a minimum of 5 years lock-in period. Still, you can extend it till your child becomes an adult.  Another feature of these funds is that investors cannot withdraw the money invested in children’s funds until it matures. So, many parents find it a suitable option for long-term investment. This feature also protects the investors of children’s funds against market volatility.

Know the purpose of children’s funds

Many parents find it challenging to gather sufficient funds for meeting the different needs of their children, be it higher education or marriage. So, they search for various investment plans to secure their children’s future, and many of them find mutual funds are a safe choice for that.  Child plans are a great alternative to long-term investment choices. It comes with several tailor-made terms and conditions for a particular purpose.

The main purpose of investing in children’s funds is to create a financial source to meet some important expenditure of their children like higher education, career, relocation, or marriage. Investing in mutual funds for their children helps them to comprise a secured portfolio. It also helps them to save good money to meet the future needs of their children against funds. Parents can choose a suitable lock-in period based on their financial requirements ranging from 5 years.  Investors will also get the option to extend it till the minor reaches the age of 18.

For creating a substantial saving to secure your child’s future

Children’s funds are solution-oriented funds that help investors saving money to meet their child’s specific future needs. These funds are meant for meeting children’s specific future objectives. The investors are mainly their parents or guardians who made the investing in the name of a minor. It offers an assured return by ensuring the accumulation of wealth, and it is tax-exempted. At the same time, early withdrawals of children’s funds impose a heavy penalty. This feature deters many investors from liquidating the fund before its maturity.

Benefits of investing in Children’s funds

Investing in the education of your children can be a long-term process. Many parents cannot save a sufficient amount for securing their children’s future because of their low income. But children’s funds allow them to increase their SIP contribution once they get a salary hike or increase in their income. Some of the benefits of investing in a children’s fund are:

  • It helps to accumulate wealth to meet the future needs of your child
  • You can provide better education to your child through this plan
  • Children’s fund comprises of a secured portfolio
  • It offers an ideal saving opportunity with limited risks
  • It is tax-exempted

Investing in children’s funds offers many benefits and better than choosing many other short or long-term investments. It is a great choice for parents who wish to secure their children’s future financially. These funds are to meet a specific future need of children, like their education or marriage. Children’s funds are a long-term investment option that offers assured returns. And many people find it a suitable investment option because liquidating the fund before maturity can impose a heavy penalty. So, invest in children’s funds as it is an ideal investment option to build a substantial saving to secure your child’s future.

That’s why Comparte Investment team asks do you have “Nivesh Ki Aadat”.

With this one can say “Mutual Fund Sahi hai”,  so let me do Nivesh