Five Investment Options To Consider For Minor Children In India

Sukanya Samriddhi Yojana (SSY)

This is a government-backed savings scheme specifically designed for girl children, which offers attractive interest rates and tax benefits. SSY accounts can be opened in a girls name till she turns 10 years old. Deposits can be made up to the age of 15 years and the account matures 21 years after opening it. It is a good option for long-term goals like education or marriage.

Public Provident Fund (PPF)

PPF is a popular long-term investment option that offers guaranteed returns and tax benefits. Deposits can be made for a period of 15 years, with an option to extend for another 5 years in blocks. It is a good option to build a retirement corpus for your child.

Equity Linked Savings Scheme (ELSS)

ELSS are mutual funds that invest a major portion of their corpus in stocks. They offer the potential for high returns but also carry higher risks compared to fixed-income options. ELSS comes with a 3-year lock-in period. This is a good option for long-term goals like higher education abroad.

Unit Linked Insurance Plans (ULIPs)

ULIPs are insurance plans that combine insurance coverage with investment benefits. A portion of the premium goes towards life insurance, while the remaining amount is invested in the markets. ULIPs offer tax benefits and are a good option if you want to combine insurance and investment for your child.

Gold

Gold is a traditional hedge against inflation and can be a good option for long-term wealth creation. You can invest in physical gold, gold ETFs (Exchange Traded Funds), or Sovereign Gold Bonds (SGBs). This is a good option to diversify your childs investment portfolio.

Important Note

Its important to consider your childs age, investment goals, and risk tolerance before choosing an investment option. You may also want to consult with a financial advisor to create a customized investment plan for your child.