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.

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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.

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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.

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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.

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    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.

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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.

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