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Save early and stay invested

In our previous blog, we discussed about the need and importance of a child’s education.  According to a survey the education cost is inflating around 10% to 12% roughly. As a parent we always want to plan the best when it comes to our child’s future. Most of us believe that giving our kids the right education will make their life more secure.

“Save early and stay invested”

Before investment planning, it’s always better to set a financial goals based on your Child’s education requirements. Financial goals can be based on your time horizon, your affordable monthly savings and corpus required.

How do you identify your time horizon?

  • Parents of age 30 to 35 years
  • Parents of age 35 to 40 years
  • Parents above 40 years

There are multiple investment options available in both equity and debt to build your portfolio. Your age plays a major role in the pattern of investment.

Parents of age 30 to 35 years

Parents under this bracket of age, has an advantage of taking higher risk. As you start investing earlier, you can take maximum risk and even 100% equity holding is possible.

Investment options for this category parents could be

  • Shares
  • Mutual funds (Equity oriented funds)
  • ULIP (Unit Linked Insurance Plan)

Parents age 35 to 40 years

In this age groups, parent’s advantage of taking a risk is a lower than the above category.  Thus, their investment patterns should be in balanced funds (equity 60% and debt funds 40%)

Investment options for this category parents could be

  • Company Debentures
  • Mutual funds (Balanced funds)
  • ULIP (Unit Linked Insurance Plan)

Parents above 40 years

Parents under this age bracket have a risk much lower than the other two categories which will limit their pattern of investment.

Investment options for this category parents could be

  • Bank FD
  • Post office schemes
  • Mutual funds (SIPs)

*All views expressed on this site are my own and do not represent the opinions of any entity whatsoever with which I have been, am now, or will be affiliated

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