Hello Investment rediffGuru(s), I have two sons, age 15 & 13. I would like to invest 5 lakhs for each of them (preferably as lumpsum). The objective of the investment is to generate monthly second income when they turn 45 (kind of annuity when they become 45, auto convert to annuity at 45 is much better). Since I have 30+ years, I would like to invest in market linked products but without any insurance (family is sufficiently covered via a term plan). Pls suggest if there any such funds/plans.
If there are no such schemes available in the market pls suggest Mutual Funds for the same objective, so they can withdraw when they turn 45 and use that for annuity.
Reason for this ask: I have turned 45 and from last couple of years, I feel that I am no more interested to work in IT (working from last 20 years) but does not posses any other skill other than IT and has not generated sufficient second income to call it a day. So want to avoid this kind of a situation to my children.
Best Regards,
Brahmendra
Ans: Dear Brahmendra,
It's commendable that you're planning ahead for your children's financial future. While there are no specific market-linked products designed for generating a monthly second income with an auto-conversion to annuity at a certain age, you can achieve similar objectives through strategic investments in mutual funds.
For long-term wealth accumulation, consider equity-oriented mutual funds with a mix of large-cap, mid-cap, and small-cap exposure. These funds have the potential to generate significant wealth over a 30+ year horizon, which your sons can later utilize for creating a monthly income stream or purchasing an annuity.
Ensure a diversified portfolio across asset classes and periodically review and rebalance the investments based on their age, risk tolerance, and financial goals.
Remember, while it's essential to plan for financial security, it's also crucial to encourage your sons to develop their skills and passions, which can provide them with alternative income sources and fulfillment in the future.
Best wishes for your children's financial journey.
