Parents are worried about their child’s future and their overall development. They naturally want to secure their child’s future, even in their absence. You can think of investing for them from the time they are born. However, before investing in anything, you should always keep security, returns and tax benefits in mind.
Mentioned below are some investment schemes for a new born:
1. Fixed deposit:
If you are looking for short term investment, then you should invest in Fixed Deposit. It is a safe option having a fixed interest rate for the entire period.
2. PFF:
PFF provides you with an interest rate of 7.6% and tax-free returns. You can invest a maximum of Rs. 1,50,000 per year for parent and minor child.
3. ULIPS (Insurance plan with equity investment):
You can retain it for the long term safety of goals. It provides tax-free returns with a rate of 10.1% for five years. It requires a high initial cost and low fluidity.
4. Recurring deposit:
It is a safe option with a guaranteed return. There is no limit to the investment amount. They are handy in only short term investments because of low-interest rates and tax on interest income.
5. Sukanya Samriddhi scheme:
It is only for girls below nine years. One can invest upto Rs. 1,50,000 per year. It provides tax-free returns with a lock-in period of 21 years. If you are planning on investing for a long period, then it is a good option for you.
Conclusion:
The best investment scheme for a new born is a fixed deposit due to the best FD rates. You can invest in any plan according to your requirements and secure your child’s future.
Read More:
Best Fixed deposit plan for a child in India
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