Last Updated on November 25, 2020 by Gopal Gidwani

Every parent wants to provide the best of everything in life to their children. However, the word that your child is growing up is very different from to what you experienced in your childhood. Thought, today’s kids have lots of opportunities and different career options, the world is also getting that much more competitive and fiercer, and be it in education or sports. To prepare your child for every future challenge, holistic development of a child is very important.

Normally, parents would only end up planning for child’s education which is not enough for today’s kids. Today children can become a coder, a gamer, a musician, an artist, even a YouTuber or make a great career in sports. To provide your child such unconventional career paths, as a parent you need a better financial support.

If your child’s aspiration is to become a professional athlete or enter the creative field, it will require proper financial planning. Today, the cost of training and equipment required for these career paths can be significantly higher than the normal education cost in India. Moreover, traditional ways of learning has been changed and online learning has become a norm. You need to buy a laptop, a tablet or a smartphone which has become a necessity now. And this becomes an ongoing expense as technology soon becomes obsolete and needs upgrades.

Therefore, you as the new age parents need to keep this in a mind that there is a lot more than just school and college fees for your child’s future. In order to give wings to your child’s aspirations, financial support is of utmost importance.

Are you prepared for it?
As a parent, it is necessary to have an investment plan to meet the financial needs that may arise at different stages of your child’s growth. To avoid stress in the future, it is important to start early. You should invest in the different investment avenues for long-term wealth creation.

You can plan your child’s expenses with the traditional investment avenues. But you also need to invest in market linked instruments such as mutual funds. In fact, you should invest in your child’s name so that the money is only utilised for the intended purpose. Premature withdrawals from the fund allocated for your child can disturb the target corpus that you plan to achieve. Hence, you can consider investing in the Children’s Fund offered by mutual funds for long term wealth creation. These funds also have a lock-in period of 5 years. This will stop the early withdrawals and to help you stay committed to the goal. You can use child education plan calculator to check how you can save for your child’s future.

You can start investing in a Systematic Investment Plan (SIP). It will help you to invest smaller amounts on regular intervals to build the required fund for your child. You can further increase your SIP with Top up SIP facility. With rise in your income levels, the amount that you set aside for your child should also rise.

Based on your risk profile, investment horizon and the corpus you intend to build, you can select the Children’s Fund which is either an equity-oriented fund or debt-oriented fund. You can invest in a Children’s Fund until the child turns 18. So, if you are starting early and have a longer investment horizon it is advisable to invest in a fund that has higher allocation to equities.

Now with the education landscape drastically changing, education cost will also move up at a much higher pace. Thus, with systematic and longer-term investments in equities you can mitigate the adversities of rising inflation and beat short-term market volatility. Start investing wisely to provide a brighter future to your child.