Child's Pay

With some creative thinking and crafty investing, give your child a lifetime of security, promises Chirag Mohanty Samal.

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It starts with nappies, pocket money and school trips. And it escalates quickly. All parents know that bringing up a child takes the cunning of an accountant and the self-sacrifice of a saint. While there will be many unexpected expenses along the way—broken limbs, lost gadgets, school picnics—there are a few major milestones that you can plan ahead for, like university, the first car or a wedding. So, should you just keep creating fixed deposits for each such big event? Or is there a smarter way to invest for your child’s future? We asked the pros and they had a few simple tips for parents building a nest egg.

BEGIN EARLY

The earlier, the better. If you put away a little fund when a child is born, there will be enough time for it to grow substantially. Taresh Bhatia, certified financial planner and advisor, illustrates this: “For instance, if you put away ₹5,000 a month, at 8 per cent interest for 15 years, you will have ₹17.3 lakh by the end of it.” The advantage of starting early is that you don’t need to invest aggressively. A small amount saved regularly will go a long way.

BE CONSISTENT