From the moment a child is born, parents wonder about the role they will play in shaping their child’s outlook on life. School admissions don’t decide the course of just the child’s life. They significantly impact the parents lives as well.
Raising a child is not just an emotional and physical investment for parents, but it’s a big financial obligation also. With the cost of education, health and food increasing, raising a child is costlier than ever in India.
Parents always want the best for their children. This involves providing for their financial future for bigger needs like their Primary, Secondary Education, their Higher Education, their other goals, and to get them off to a good start in life.
Every child has a right to decide his/her future and live out their dreams. However, with the growing costs, this may come out as a heavy burden on the parents. Education inflation is increasing by 15% to 20% every year, and simple savings accounts are too short to cut on those expenses. But this would be possible only if you invest wisely in the present.
Investing should start as soon as it is financially viable. The older the child, the greater the expenses. Hence, it becomes important that parents plan for their children’s future needs early on and give sufficient time for these investments to grow. The earlier you start, the greater are the benefits you will reap.
For instance, if you start saving and investing as soon as your child is born, imagine the corpus you can accumulate when he/she reaches the age of 18.
Financial discipline is one of the most critical factors to meet your long-term financial goals, and financial planning for a child’s future. It requires meticulous planning as well as a sustained approach to build a corpus, keeping in mind the nature and variety of expenses involved.
Whatever you choose as an investment option, make sure it is consistent and regular. Mutual Funds provide a brilliant option to address this by way of a Systematic Investment Plan, popularly called SIP. The other important aspect of investing is to not get influenced by market noises and stay on course with your investments.
Conclusion:
While you can’t always control your own situation or your child’s, taking these steps is a great way to set contingency plans for a variety of financial obligations that may affect you in the future. Creating long term financial plans and goals can help achieve financial stability for your family, especially through the years that your child depends on you the most.