Investing Rs 5000 every month in SIPs can fund your child's higher education
Once you start planning to have children and extend your family, you have to keep certain expenses in mind.
One such expense is Education. Every parent wants to provide bright future for their child and education fees is something which will increase over the time.
Which means, you have to start saving or investing from the birth of the child so that you have enough time to create fund for your child's education.
Here comes one simple investment instrument, Systematic Investment Plan (SIP). We tell you how:
If parents can start this SIP when the child is 3-5 years old, they will have a good 10-15 years to build the corpus. This will not burden them at the time when the child goes to college and would have also allowed them to benefit from the power of compounding interest.
Now, if you invest just Rs 5000 in SIPs for 20 years, your total investment amount will be Rs 12,00,000. Considering expected rate of return is 13%, at the time of maturity you will get Rs 57,27,596.
This means, your total growth is Rs. 45,27,596. Clearly, with the return you can provide better education without worrying about education loan. Moreover, you can even plan to save money for your retirement.
Amid all the education planning, parents must not forget that they are getting old too and the age of retirement is getting near with each passing year.