4 Reasons To Buy Equity Funds For Your Child

  Author: Kundan Kishore

There are many investment options available to you when you are investing for your child’s future needs like higher education. There are also many reasons why you should be making equity investments and benefitting from the typically high long term growth of your money. Since an individual may not have the skills, financial wherewithal and time to make equity investments, investments in equity mutual funds, offered by mutual funds, become the best alternatives. Here are four top reasons that you simply can’t afford to ignore equity funds.

Higher returns even after inflation’s impact The cost of higher education has grown annually by 10-12% in the last decade. To save enough, invest in equity funds, which when compared to other investments such as fixed deposits typically provide the highest growth over periods of 8-10 years, or more.

Benefit of professional fund management Mutual fund offers you expertise of fund managers for managing your investments at a very nominal cost.

Tax advantage There is no tax on the capital gains you make on your equity fund investments which are more than one year old. That’s great when you have to save for your child over 8-10 years or more.

Freedom to invest small amounts You can invest in an equity mutual fund through a systematic investment plan (SIP). It allows you to invest as little as Rs 500-1,000 per month, an amount which you can increase with pay hikes.

Clearly, there is much going for equity funds. As a parent with big dreams for your child you need to keep them as your constant companions in your journey to your child’s future. 

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