As your child continues to grow he or she is a pre-schooler now, you will notice new and exciting abilities that your child develops. Providing children the ideal opportunity for learning and development is the foremost among the parent’s goals. So, now planning for your child’s college education is one the long term financial goal of your life.
The important things to keep in mind while investing towards any goal is to start early as possible and should implement the concept of stepping up. For example, if you earn Rs 70,000, save 10% of that which is Rs 7,000 then if your income increases to Rs 75,000, you must increase your savings as well to Rs 7,500.
Let us look towards how you can plan to build your own portfolio to meet the long term financial goals of higher education of your child by including these financial instruments:
As they say, “little drops of water make the mighty ocean” one of the best ways to entering the market is through systematic investment plan (SIPs), as it also brings investment discipline in your good self. You also need to ensure that your targeted goal is inflation-protected like the time value of today’s 50 Lakhs at 6% inflation 10 years down the line will be 28 lakhs. The compounding impact of these investments helps you in beating the inflation by comfortable margin.
Let us suppose it requires 18 Lakhs after 10 years and then your current savings rate of Rs 8,545 per month over the next 10 years will make you accumulate a principal corpus of Rs 10.25 Lakhs. At an average rate of 16% the portfolio will become Rs 25.00 Lakhs. At an average rate of 13% the portfolio will become 20.85 Lakhs. In case the returns are lower 11% the portfolio value will be 18.54 Lakhs. Thus in all the three instances you are able to make your targeted sum.
Some of the top SIP performers that are available in the market are Axis Bluechip Fund, Canara Robeco Emerging Equities, SBI Bluechip Fund, Nippon Growth and many more.
Once all your investments are in place, always remember to review and rebalance them at least once a year to make up with market trends and volatility. Pull up your socks Go ahead! and start investing.
Stay Tuned, Stay Relevant!