Investment for Children’s future
There are four types of investments for children:
Insurance products like Komal Jeevan, HDFC young star varients and similar products from other insurance companies: They are pure insurance products with less emphasis on investment. So, expect a meagre return on investment if everything goes well.
- ULIPS: They try to give more weightage to investment coupled with Insurance component. Charges are relatively high which will reduce your returns. And you pay more for a meagre insurance.
3.No risk products: Sukanya Samriddi- only for daughters below 10 years. Return is 7.6% this year and backed by govt guarantee. If male child, then schemes like PPF which has interest of 7.1% this year.
4.Mutual fund schemes aimed at children: Example: Axis children’s gift fund and HDFC Children gift fund: They have some interesting features with average returns if you compare with balanced mutual funds.
Which is really best? Can’t say. Need to understand the financial goal, how does it fit to your existing investment portfolio and your risk appetite. We can discuss offline.