We make every effort to fulfill the wishes of children. They want to give them everything they want. We attach ourselves to their dreams. But, this will happen only when our plan is right. Work for it Children’s dreams change from time to time. They can be bigger and better. But, your financial plan should have the ability to take care of all their needs.
Financial planning for a child is not necessarily related to your paycheck. Anyone who can plan judiciously and allocate his investment in the right asset class can achieve his financial goals.
Can you open both Sukanya Samriddhi and PPF account in the child’s name?
Be it big or small. There are many children’s plans available today that promise protection. Since financial goals for children are usually long-term. So it is good to move in the direction of equity mutual funds. It has both the power of equity and the trust of mutual funds.
There is a simple formula for any long-term goal. It says that make the most of your time and money. Starting early will help you. By taking small steps, you achieve big goals. SIPs in equity mutual funds will help you to make this small beginning.
All you have to do is let your money be used to take advantage of compound interest for a long time. Also, make sure that you have enough money for emergency or other needs.
SIPs are not touched until they reach their financial goals. Using SIP during emergency will hinder you from reaching your financial goal. Not only this, it will also limit the magic of raising money due to compound interest. Once you have allocated money for all your financial goals, then the management of money becomes easier for you.
You just have to monitor your investment.
When the time is right, you can start reducing the risk of your portfolio. This is the time when you know that you will need money soon to pay your child’s college fees. At the same time, you need to withdraw money from equity mutual funds and invest in debt funds. This helps you to transfer the benefits from your investment to a safer option.
Cleverly done asset management will help you in fulfilling your children’s dreams. Instead of spending your money on expensive toys or smartphones, give them the gift of financial security, which they are entitled to. No matter what they decide to do with their lives. But, your planning will give them wings to fly in the sky of life.
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