Dear Anil ji, I am 41 year old working professional and i have two kids age 7 and 2 year respectively. I want to keep aside 20 Lac for each of them, so money multiply around 2-3 times, when they grow up and require for higher education and marriage due expense initiating in 10-12 years from now. Importanly i dont want to pay yearly tax on the interest it generates as already i am in 30% slab , A one go long term capital gain will be ok .. Kindly suggest 2-3 options to consider .You may consider my risk appetite as low to medium.
Ans: Considering your low to medium risk appetite and tax concerns, here are some options to grow the 20 Lac corpus for each child over 10-12 years:
Equity Mutual Funds: Opt for balanced funds or hybrid equity funds that invest in a mix of equity and debt. These funds aim for capital appreciation with some stability from debt allocation.
Debt Mutual Funds: Choose debt funds that invest in high-quality corporate bonds or government securities. They offer better post-tax returns than traditional FDs and are more tax-efficient for investors in higher tax brackets.
Sukanya Samriddhi Yojana (SSY): For the younger child, SSY can be a good option with tax-free returns and attractive interest rates, specifically designed for girl child's education and marriage needs.
These options aim to provide growth while considering your risk profile and tax concerns. Regularly review and rebalance your investments to align with your goals and changing market conditions.