As a parent, securing the future of your baby girl and providing her with the best possible means is vital for her prosperous career and life. Setting up the right investment instrument to help build a corpus for your daughter’s future is much needed. Thankfully, there are plenty of investment options that can be utilized as part of your plans for your daughter’s future.
We here look into the best investment options and savings schemes for your girl child below in this article. Read along.
8 Best Investment Options for Your Baby Girl in India 2023
1. Sukanya Samridhi Yojana (SSY)
- Sukanya Samridhi Yojana (SSY) was started as a means of investment option to allow parents to secure their future for their baby girl and has been one of the top picks among parents to begin with. The scheme can be started right after her birth and is opened by the parents or legal guardians looking to secure the future of their daughter. The scheme offers an interest rate of 8%, substantially higher than the other investment options around. It can be opened with just Rs 1000 and has a maximum investment limit of Rs 1.5 lacs annually. The fund then matures when the daughter reaches the age of 21 and is tax-exempt on the hands whilst also allowing for a Sec 80C deduction.
2. Post Office Term Deposit (POTD)
- The second one on our list is the Post Office Term Deposit which has been around for quite a while and is much preferred by parents as an investment scheme for their daughters. The scheme comes with a lock-in period of 5 years and can be opened via any post office across India. It has an interest rate offer of 7.5% as of present. The scheme can be opened for your baby girl who is over 10 years old and comes with a minimum deposit of Rs 1000 with no maximum deposit limit. The interest earned on it is taxable though the 5-year tenure comes with tax benefits and can be availed under Sec 80C.
3. Post Office Recurring Deposit (PORD)
- Another of the post office savings schemes offered by the Indian Postal Service, Post Office Recurring Deposit is widely used by many parents. It is easy to setup and can be opened via any post office across India. It can be started with just Rs 100 per month and has an interest rate of 5.8% to 6.8%. It comes with a mediumterm of 5years that can be extended further. It can be opened for daughters above 10 years of age just like the Post Office Term Deposit. It’s generally a safe sound investment option as it is government-backed and is the perfect choice for parents looking for a risk-free option.
4. Children Gift Mutual Fund
- Children Gift Mutual Fund is a great investment initiative that has been promoted for its ability to generate market returns according to the growth in the market. It can be a great option as a parent to venture into a child gift mutual fund to build a corpus for your daughter’s future. The scheme is generally a hybrid or balanced fund that invests your money into a combination of debt and equity instruments. The funds are locked till your child reaches the age of 18 years and can be accessed thereafter. The idea behind this investment is to build a long-term compounding return.
5. Unit-Linked Insurance Plans (ULIP)
- Unit Linked Insurance Plans are a commonly preferred investment option for many people and it can be a great option for a parent looking to build a good investment fund for their daughter. The idea behind the ULIPs is to have part payment towards insurance and the remaining into equity to build market returns. The plans for child ULIPs come with triple benefits in comparison to other plans. It also comes with the option of providing the family with a regular monthly payout in case of the death of the parent. The daughter also gets the total amount as the payout in the case of the sudden death of the parent or guardian.
6. National Savings Certificate (NSC)
- The National Savings Scheme is a time-tested investment option that is readily used by many people around. The plan is a great option for parents looking for a good investment option for their daughter. It is offered as part of the post office savings scheme and comes with a tenure of 5 years. The minimum deposit for the same is Rs 1000 with no upper limit on the maximum limit and comes with an interest rate of 7.7% at present. The scheme also has tax benefits under Sec 80C.
7. National Scheme of Incentive for the Girls of Secondary Education
- Next up is one of the pan-India investment schemes offered by the Department of School Education & Literacy as part of the HRD Ministry. The scheme is made to support the girls inthe deprived sector to pursue further study. The scheme is for unmarried daughters under the age of 16 years and allows them to receive Rs 3000 as a fixed amount for completion of secondary education while the whole amount can be withdrawn after the daughter completes her 10th
8. Fixed Deposit
- Fixed deposits are one of the traditional means of investment option that still holds ground to this day in this modern world. It is often regarded as a safe option and much preferred by parents. It can be a good option to start with fixed deposits if you’re unsure of where to begin with. The plans come with varied terms starting from a few months to 10 years and can be opened with just Rs 1000. The plan comes with flexible interest rates based on the term period. Investing in fixed deposits offers flexibility and is liquid allowing for encashment if needed.
There are various investment options available in the market for parents looking to invest and build a sizeable corpus for their baby girl for a secure future. The aforementioned options are the most preferred choices for many parents. You can start with one scheme or invest in a combination of various schemes for better returns and minimize risk. It is always advised to do thorough research before investing to safeguard yourself and find the best solution.