How do you invest for your Child’s Future Goal?

Saving for your children’s future becomes a pertinent long-term financial goal. Putting your child’s needs before yours by trying to seek the best possible standard of life for their future requires

In this ever-increasing world of rising costs and rising inflation, the cost of education is becoming expensive with every passing day from primary to secondary to higher studies. Thereby, it is essential to plan for it early by investing in investment avenues such as a mutual fund for your child. Mutual Fund schemes have potential to provide long term risk and inflation-adjusted returns. If you have some other goal in mind, the process and factors influencing the investment remain the same.

If you consider below three steps diligently, it will help you to be closer to achieving your financial goal.

1.       Gather Adequate Information and Estimate Costs
You may not immediately know  your child’s career ambition 15 or 20 years down the line but getting a rough idea of what your child’s education in the future would be, is to consider to  start  planning a mutual fund for your child’s future goal. Higher education in top reputed institutions across India is expensive and studies abroad being much more.

 

At the same time, you also need to factor in the inflation rate (rise in costs) while calculating the future costs of their education. Let’s take an example: If you are looking at an MBA education which costs Rs. 25 lakhs today. 15 years from today, @ 6% annual inflation, fees would cost Rs. 59,91,395 lakhs. When you come to think about this amount as a whole, many people may not be financially ready to prepare a corpus for their kids’ future needs.

 

2.       Consider Investing  in Equity Mutual Funds for your child future goal
Just saving money for your child’s education may not be enough. You need to let your money invested for the long run. Coping better with inflation could involve investing in instruments that have a moderately higher risk. Equity mutual funds could be one such Mutual fund for your child that has potential to provide long term risk adjusted return

 

3.       Start Early and Invest consistently via Equity SIPs
One of the smart decisions any parent could take is to start saving early. Starting early gives you the benefit of the power of compounding and helps generate wealth from your mutual fund for your child. If you haven’t yet invested in equity mutual funds for your child’s education, then you can start your mutual fund investment via SIPs because SIP investing in equity mutual funds  inculcate a sense of discipline and develop a long-term approach thus helping you the opportunity to accomplish your long-term life goals like your children’s education.

 

The main objective is to help you plan with a mutual fund for your child’s education goal so that he/she does not face any hurdles when it comes to paying fees or accomplishing any other dream. While economic fluctuations are unpredictable, planning early through a mutual fund for your child can help  In achieving your goal.

 

Disclaimer: The views expressed here in this Article / Video are for general information and reading purpose only and do not constitute any guidelines and recommendations on any course of action to be followed by the reader. Quantum AMC / Quantum Mutual Fund is not guaranteeing / offering / communicating any indicative yield on investments made in the scheme(s). The views are not meant to serve as a professional guide / investment advice / intended to be an offer or solicitation for the purchase or sale of any financial product or instrument or mutual fund units for the reader. The Article / Video has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Whilst no action has been solicited based upon the information provided herein, due care has been taken to ensure that the facts are accurate and views given are fair and reasonable as on date. Readers of the Article / Video should rely on information/data arising out of their own investigations and advised to seek independent professional advice and arrive at an informed decision before making any investments. None of the Quantum Advisors, Quantum AMC, Quantum Trustee or Quantum Mutual Fund, their Affiliates or Representative shall be liable for any direct, indirect, special, incidental, consequential, punitive or exemplary losses or damages including lost profits arising in any way on account of any action taken basis the data / information / views provided in the Article / video.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.