Long ago, someone said that children are the ones who make us both insane and sane. It is a contradiction, but one that makes sense. Their needs cost us money, time, and effort, yet their achievements and mere existence make our hearts flutter. We understand how important it is to provide for children, and ever since we started our establishment two decades ago, we have strived to help families achieve that goal. This article is written for families who are trying to achieve what we helped many of our clients achieve. So read this article entirely to understand the importance of mutual funds for child’s future.
What Are Mutual Funds?
If you are not familiar with it, then listen. Mutual funds are simple investment plans where many people invest their money together. This money is managed by experts and invested in shares, bonds, and other financial instruments. The goal is to grow the money over time.
Are Mutual Funds Based on Luck Alone?
We are addressing this because many people think mutual funds are unpredictable and based entirely on luck. In reality, they are not driven by chance. As the saying goes, true luck is what happens when preparation meets opportunity.
As mutual fund advisors, we prepare your portfolio carefully to match the right opportunities by considering financial and market factors.
Why Planning Early for Children Is So Important?
When you have a child, you can estimate some costs like clothes, baby formula, etc. But what happens when they grow? The costs will grow. School fees, college education, coaching classes, hobbies, and later even higher studies require a lot of money.
The cost of education is increasing every year. What costs 5 lakh rupees today may cost 15 or 20 lakhs after ten years.
If parents wait until the last moment to arrange money, it becomes a very stressful situation. Taking loans or selling financial assets can disturb the entire family’s financial balance. That is why planning early makes a huge difference. And what better way to do it than investing in the safest investment option: mutual funds for child’s future?
You do not need to be a financial expert to invest in mutual funds. They are designed in such a way that common people can start easily with an advisor’s help.
Rising Costs of Education in India
According to the Local Circles survey that interviewed more than 30,000 parents across India, there has been a 50 to 80 percent increase in school fees in the last three years.
Also in major cities, parents spend around ₹2.5 to 3.5 lakh per year per child on schooling when you include fees, transport, uniforms, books, and other costs.
Why Mutual Funds Are Key to Securing Your Child’s Future?
We can say a thousand things, but there will still be doubts about whether mutual funds are worth it or not, which is why it is better to rely on proven data.
According to a Business Times informative article, children-focused mutual funds in India have delivered around 14 percent average annual returns over three years and about 17 percent over five years. That is a strong performance, and it clearly shows that mutual funds have the potential to outpace inflation.
If you are planning to invest, you can do it on your own. However, studies also show that investors who work with mutual fund advisors are more likely to achieve better financial outcomes than those who invest without professional guidance. So take that into consideration before investing.
When to Start Mutual Funds?
Starting early is the biggest advantage a married couple can have. While mutual funds are beneficial for parents, they are even more advantageous for couples who are planning to have children in the future. This is exactly why financial planning through mutual funds for child’s future should begin as soon as possible.
Mutual funds are not meant for short-term gains but for secure, long-term growth. Those who invest early reap greater rewards in the future.
As the saying goes, “Fortune favors the bold.” If you are bold enough to invest regularly and gradually increase the amount over time, you can achieve financial success in the long run with the power of compounding.
Final Thoughts
Taking the first step is important. You came here to do research because you have the mindset of someone who is willing to achieve success. However, the hardest step is not the first, but the second.
You need to start investing in mutual funds, and with the help of an advisor, you can do it easily.
At ProfitsZone, we have years of experience working with parents like you, navigating market shifts, and helping clients grow their assets. For any questions, please contact us today.