How right is it to invest in mutual funds focused on children, how different is it from normal funds? – how right is it to invest in mutual funds focused on children how different is it from normal funds – News18 Hindi
highlights
Child mutual funds have a minimum lock-in period of 5 years.
It can be invested in for children below the age of 18 years.
There are 8 fund companies in the country that have child mutual fund plans.
New Delhi. Parents do many types of planning regarding the future of their children. They are looking for savings and investment options to secure their future financially. In such a situation, it is natural to think of mutual funds. Mutual funds are known to give better returns than any other investment option. By investing in it, the fund can be increased manifold in 5-10 years time. Remember that investing in mutual funds is an aggressive strategy. Due to being linked to the market, the risk is also equal in it.
But is it right to invest in mutual funds focused on children? In India, which fund companies bring separate plans for children and how are they different from common plans, today we will tell you the same. Before knowing how right it is to invest in it, let us understand what are child mutual funds.
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Child Mutual Fund
These funds are usually hybrid. Their investment is also in some safe options like debt. Apart from this, they invest in such stocks which give more returns than debt bonds. This means that these funds diversify their portfolio in such a way that there is assurance of safety along with better returns. These funds are for children below 18 years of age.
what to invest
According to a Moneycontrol news, 8 mutual funds in the country have child-oriented schemes. These are called solution oriented schemes. There is a lock-in period of 5 years or till the child completes 18 years of age (whichever is earlier). There is no income tax benefit of this scheme. If you remove the lock-in and name, then there is no difference between it and normal funds. According to Moneycontrol, open ended schemes are a better option for investment. You can invest and withdraw money anytime in open ended schemes.
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Tags: business news in hindi, Investment and return, investment tips, mutual funds
FIRST PUBLISHED : November 20, 2022, 09:29 IST
