On this Children’s Day, as we celebrate the joy and promise that each child brings into our lives, it’s also a moment for parents to reflect on the critical role of financial planning in securing their children’s future. 

Vaibhav Jain, Head of Content and Education, shares some invaluable insights and stories that can serve as a compass for parents navigating the intricate landscape of financial planning for their children.

Teaching Financial Literacy Is The First Building Block:

One of the fundamental lessons Vaibhav underscores is the importance of instilling financial literacy in children. “Make them part of discussions about money management,” he advises. This involvement includes familiarizing them with the terms used in financial planning and educating them about various avenues for investment.

The Power of Long-Term Investments – Equities and Discipline:

Vaibhav emphasizes the potential of long-term investments, particularly in equities, for securing a child’s future. While there are focused funds tailored for children, he encourages parents to exercise discipline in managing investments themselves, thereby avoiding unnecessary fund expenses.

Retirement Planning & Child Investment Should Go Hand in Hand:

“Don’t neglect retirement planning,” Vaibhav cautions, highlighting the necessity of striking a balance between investing for children and ensuring one’s financial security in retirement. Children can indeed become a pillar of support in old age, but parents are urged not to burden them with financial responsibilities.

A Golden Rule – Leave No Debts for Your Children:

Taking a firm stand against leaving debts for children to pay, Vaibhav stresses the importance of settling financial matters during one’s lifetime. Writing a will is presented as a crucial step to prevent potential conflicts among siblings and to ensure a smooth transition of assets.

Teach them the Value of Money (Practically!) through Education Loans:

Encouraging children to take responsibility for their higher education loans is another piece of advice.”Let them take their own education loan for higher studies,” Vaibhav suggests, as this not only imparts financial responsibility but also teaches the value of money when repaying.

Sukanya Samriddhi Yojana – Nurturing the Blossoms:

Vaibhav recommends exploring Sukanya Samriddhi Yojana as an excellent avenue for long-term investment. This government-backed savings scheme specifically caters to the financial needs of a girl child, offering attractive interest rates and tax benefits.

Life Insurance – Safeguarding the Future:

In the realm of financial planning, Vaibhav advocates for the importance of life insurance. “Take life insurance,” he asserts, emphasizing its role in providing financial protection and security for the family.

As parents, our responsibility extends beyond the present, reaching into the future that we are actively shaping for our children. These insights serve as a compass, guiding us through the labyrinth of financial planning, ensuring that every decision sows the seeds for a secure and prosperous tomorrow. 

Happy Children’s Day, and here’s to nurturing not just dreams but also the means to achieve them!

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