Tag: Child Future Planning

Child Future planning

Every parent wants their child to be successful in his/her carrier , and want to financially secure future need/s  of their child like education , marriage etc, but the biggest challenge today is to prepare for mounting cost of education and marriage which is going dearer day by day , one best way to offset this challenge is to start saving/investment for your child future as early as possible, starting early has other benefits too like it can even eliminate need of education loan or other loan.

Common Mistake

Not Considering Inflation (in simplest word inflation is price going up over the time ), and  the biggest risk of not considering inflation while planning for child future saving/investment is falling way short of required corpus when your kid is actually ready and eventually to cover the gap it will force you and your family to go for debt or loan.

As we are in internet age , every information is available at the click only but the flip side of coin is that we are bombarded with so many information and usually we fall prey to wrong information or get allured by marketing names like child education plan , child marriage plan and etc, some time due to our belief system we are more tend towards insurance when it comes to financial planning and we normally choose insurance as a tool for our saving and investment needs , we forget the fact that insurance policies due to cost of insurance and other expenses become low yield financial product even in the long term , normally a long term insurance policy say 20-30 yrs policy offers return in the range of 4.75% to 5.5% per annum maximum, where we have existing inflation of more than 6% per annum, so if you are planning with insurance you are actually losing the money.

Insurance Risk coverage is necessary for you and your family future and it can be fulfilled with low cost Term Plan, there is genuinely no need to mix the insurance and investment in one product, as bundled product loses the sanctity of both objectives.

Some Expenses are even faster than inflation

What product to choose

Again it is an important question, what to choose as an investment option for Child future planning, nowadays Mutual Fund appeared as most transparent, flexible, convenient, most potential in terms of delivering good rate of returns, now question may arise which mutual fund there is lot of option when it comes to investment in mutual fund, luckily some mutual fund companies has special children fund as a plan where as far as return are concerned they are offering handsome return since inception.

Some Schemes are as following

HDFC Children’s Gift Fund                          Return Since Launch 17% Compounded Annually

Axis Children’s Gift Fund                             Return Since Launch 11% Compounded Annually

ICICI Pru Child Care Fund                           Return Since Launch 16.5% Compounded Annually

SBI Magnum Children’s Benefit Fund      Return Since Launch 10.5% Compounded Annually

Example: An SIP Since Inception of Just Rs 10000/Monthly invested in HDFC Children’s Gift Fund (total investment of Rs 20,60,000 would have grown to Rs 1.06 Crore by 30^th April 2018

Why to start early

If you Start investing Rs 10000 per month into a scheme that earns 12% return, in 20 year it would become Rs 92.08 Lakhs, but if you start one year late the same amount of monthly investment in 19 years (if your are late by one year) would become Rs 81.07 Lakh only , that means getting Rs 11 lakh less for delaying one year only, this gap would further increase if you delay by 2 yrs or 3 yrs or more years .

So not only choosing the best investment option is necessary it is also equally important to start as early as possible because time is also an important factor to consider when it comes to investment or goal planning , so start smart and start now

Start with NDI Consultants

We are Varanasi based Mutual Fund Distributor, with experience of 15 years in the field of Mutual Fund Advisory, Wealth Management, Retirement planning, Child Future Planning, Goal Based planning etc, Apart from Mutual Fund Distribution we have developed tools and system to make customer service even better, we don’t search client for product pitching rather follow strict need based analysis to search product for our clients.

To Start Child Future Planning for Your Child you can schedule meeting with us at your place (for Client residing in varanasi) or at our office, you can call 9839064344 or 9795110044, or write mail divesh@mfexchange.com or shreeprakash@mfexchange.com  and even you can start investing online with our website www.investwithndic.com