Saving is a very fine thing. Especially when your parents have done it for you.
- Winston Churchill
Hyderabad: Well said! There is nothing better than nourishing the future of our kids & loved ones. Generally, we tend to gift our kids their favourite toys or expensive gadgets or clothes but most of these gifts turn out to be redundant in the long run. There is an important option available that a lot of people don’t explore that is a financial gift. On this Christmas, be a smart Santa and choose a saving/financial plan for your kids.
Let’s see what is the canniest way of doing it?
Piggy bank- The first and most obvious gift you can gift to your kid would be a piggy bank. It may not be as popular as previously, but using a piggy bank or saving jar can make saving fun. Put some cash or coins on that piggy bank also. This activity will surely make them understand the value of money.
SIP for college fund or marriage- Assuming that you have already opened a bank account of your kid, help fund it with a cash infusion or start SIP (Systematic Investment Plan). Depending upon their age, even a small contributed monthly/quarterly/annually can amount to a sizeable sum for their higher studies or marriage.
Debt mutual fund- Go for debt mutual funds if you are planning a long term investment gift idea. Invest in AAA security funds and secure your child’s future. Let your child know about this plan and the tenure of the maturity. Having something which is being years away from being able to spend it is a great way to teach patience.
Gift a blue-chip stock- Gift a renowned company stock. Sit down and explain exactly what a stock is and how it works. You can choose with a company that the child already knows, such a movie studio, a toy company or a phone maker. It will be more fun than it sounds. Minors can’t buy stocks but you can open a custodial account in their name, which you control.
Gold ETF- Gold gifts are extremely precious and a great investment option. You can invest in gold for your kids but do not do it through physical gold. The best option would be gold ETFs which can give a better return than other assets class.
(Written by Indu Choudhary, Personal Finance Expert)
