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Looking for the best investment optionsfor taking care of your child\u2019s education expenses? Here are 5 key steps to selecting the best child investment vehicle.<\/p>\n\n\n\n
After setting the financial goal of saving for your child\u2019s future, you must start saving early. This way, you\u2019ll set aside a larger sum for investing, and after investing, the money will gain from the power of compounding.<\/p>\n\n\n\n
Investing in equity mutual funds<\/a> online with a long-term investment strategy is a smart choice. Equity mutual funds generate good returns by parking your funds in the stocks of companies across different market capitalisations. While equity funds are riskier, investing for the long term can gain you higher returns.<\/p>\n\n\n\n Equity mutual funds invest exclusively in equity securities. Sometimes, to leverage better market opportunities, they make a small allocation in cash or equivalent instruments.<\/p>\n\n\n\n Before investing, you can use a SIP<\/a> calculator to determine how much money you need to accomplish your goal, i.e., pay for your child’s educational expenses.<\/p>\n\n\n\n Debt funds park your funds in fixed-income instruments, like treasury bills, commercial papers, government securities, corporate bonds<\/a>, and other money market instruments. Before deciding on a systematic investment plan<\/a> for the long term, consider choosing the debt funds depending on the bonds\u2019 credit quality. Always try to invest in debt funds with AAA-rated bonds.<\/p>\n\n\n\n Additional Read: <\/strong>Investing Lessons You Should be Teaching Your Children for a Better Financial Life<\/a><\/p>\n\n\n\n The next on the list of best investment plan to save for children’s goals is purchasing gold. Nowadays, you can invest in gold in a more cost-effective way through gold exchange-traded funds (ETF). Gold ETFs symbolise paper gold and are almost similar to purchasing MF units. Here, you buy and sell Gold ETFs on a stock exchange (NSE or BSE) where gold remains the underlying asset.<\/p>\n\n\n\n Finally, NRI investment options for securing your child\u2019s future also includes hybrid mutual funds. Hybrid MF schemes invest in more than one asset class. Typically, they comprise equity assets, gold, debt assets, and even real estate. Hybrid funds build your wealth through asset allocation, diversification, and correlation.<\/p>\n\n\n\n Before investing, remember to factor in the expense ratio of the fund you\u2019ve chosen, which shouldn\u2019t be high. Check the fund\u2019s track record over three to five years and only invest if the performance has been consistently strong.<\/p>\n\n\n\n Additional Read: <\/strong>What is Goal-Based Financial Planning?<\/a><\/p>\n\n\n\n For a goal 4-8 years away, you can create a core portfolio with well-faring equity MF schemes across large-cap funds<\/a> and mid-cap funds<\/a> to earn solid returns.<\/p>\n\n\n\n If you invest in hybrid funds, your investment risk is minimised as hybrid schemes diversify within multiple asset classes to score maximum returns.<\/p>\n\n\n\n As you can see, investing in equity, debt, hybrid mutual funds, and gold ETFs are well suited for securing your child’s future and taking care of educational and other expenses. Start your investment journey with a smart one-stop solution to indulge in goal-based investing; download the Moneyfy’s mutual fund app <\/a>today.<\/p>\n\n\n\nDebt funds<\/strong><\/h3>\n\n\n\n
Buying Gold ETF<\/strong><\/h3>\n\n\n\n
Hybrid funds<\/strong><\/h3>\n\n\n\n
#3 Check the fund\u2019s track record<\/strong><\/h2>\n\n\n\n
#4 Create a solid portfolio<\/strong><\/h2>\n\n\n\n
#5 Start investing<\/strong><\/h2>\n\n\n\n