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Child Future Savings

Empower and strengthen your child’s future, today. Don’t let finances get in the way of your child’s dream!

 “Education is not preparation for life, education is life itself.” – John Dewey

If you had to plan in 2009 for today's cost, how much would you have to save monthly then?

Fields of Professional Education

2009

2024

Monthly Savings needed from  2009 to 2024

MBA

6.34 Lakh

26.50 Lakh

5,900
Engineering

2.05 Lakh

  8.59  Lakh

1,900
Medical

16.97 Lakh

70.89 Lakh

15,700

How Much is Enough?

  • With rising education costs across all professional degrees, saving for education becomes even more imperative
  • Child care costs also include additional costs of housing, transportation, clothing, food, health care, etc.
  • Long term equity investing is a suitable medium to combat ever increasing costs

Prepare for the Best

  • The best professional degree courses cost up to ` 26.50 lakh* per annum
  • Similar courses abroad can cost significantly more
  • Premium institutes have the pricing power and inflation will take these numbers higher year after year
  • The cost of education should not come as a surprise to you
  • So, prepare for the best, though you may have options to choose from!
  • Save regularly with a goal in mind
  • Finances should not get in the way of your child’s dreams

The Cost of Procrastination - Don’t delay the inevitable

Goal based Investing towards Child’s Education

The road to Rs. 50 Lakhs!

  • Rahul’s parents start early and save Rs. 11,100/month for 15 years
  • Manisha & Pooja's parents are late starters and have contributed a higher amount on a monthly basis to accumulate the same amount as Rahul’s parents
  • Manisha: Rs. 22,200/month for 10 years
  • Pooja: Rs. 59,600/month for 5 years

The later you start, the less your money works for you!

  • Targets a specific amount of corpus for your child’s education
  • Money is earmarked for a specific purpose. For instance, investors do not touch PF corpus for buying a car (as the money is earmarked for retirement)
  • Investors tend to rationalize their spending on other personal / social requirements
  • Investing with a goal brings discipline Balances your current aspirations vs future requirements. A sizeable corpus can be built over time
  • Mental Accounting is involved, ensuring long-term holding of investments

Mental Accounting

  • “Mental Accounting” is an economic concept as per which investors divide their current and future savings into separate, non-transferable portions aecting their consumption decisions and other behaviours
  • Mental accounting leads to long term thinking and financial discipline
  • Since children`s education expenses are substantial and important, a corpus meant for the same needs to be saved separately
  • Such investments are to be withdrawn only when nearing the goal

Equities - A Powerful tool against Inflation

In the long run, Equity have been able to beat other Asset Classes!

  • Aren’t equities risky? Having a short term view or investing directly in equities without adequate knowledge can be risky. Volatility reduces with time in equity. Hence choose the right mutual fund scheme.
  • Should I put all my money in equities? Not entirely. When you have a lot of time to achieve your goals,invest predominantly into equities. As you near your goals, you need to shift gradually to lesser volatile asset class like debt.
  • How do I invest in equities? Lumpsum investments or Sytematic Investment Plan with a Mutual Fund. As your income increases, do a SIP Top Up.
  • Have equities beaten inflation? Equities have beaten inflation and have compounded better than other asset classes indicated here over the last 20 years.

How Mutual Funds help?

Professional Fund Management

  • Expert fund management
  • In depth research
  • Conscious portfolio management to optimize returns

Long term financial goal planning

  • Meet financial goals by investing in products catering to a wide array of investment goals
  • Options to invest regularly in small doses or lump sum

Other benefits

  • Diversification even with a small investment
  • Liquidity
  • Tax benefits

SIP or Lump Sum?

SIP

  • Investments at a predefined monthly or quarterly frequency
  • For a salaried individual, the income is monthly and so should be the savings
  • Ideal way to develop a savings habit
  • As the income increases, do SIP Top Up
  • This would inculcate discipline as to spending what is left after saving

Lump Sum

  • Lump sum when you receive large flows like a bonus
  • Ad hoc investments on special occasions like festivals or your child’s birthday
  • Aren’t equities risky? Having a short term view or investing directly in equities without adequate knowledge can be risky. Volatility reduces with time in equity. Hence choose the right mutual fund scheme.
  • Should I put all my money in equities? Not entirely. When you have a lot of time to achieve your goals, in- vest predominantly into equities. As you near your goals, you need to shift gradually to lesser volatile asset class like debt.
  • How do I invest in equities? Lumpsum investments or Sytematic Investment Plan with a Mutual Fund. As your income increases, do a SIP Top Up.
  • Have equities beaten inflation? Equities have beaten inflation and have compounded better than other asset classes indicated here over the last 20 years.
  • Meant for all children below the age of 18 years
  • Healthy allocation towards equities which is an ideal long-term asset class coupled with debt allocation which provides stable returns
  • Investments can be made on a lump sum or SIP basis and there is no limit to the number of transactions in any given year. No maximum limit on investment
  • Benefit from the long term potential of equity while  maintaining the stability of debt
  • Capital appreciation over long term
  • Investment in equity and equity related instruments as well as debt and money market instrument
If you have any query, please do contact us
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PowerPusher Financial Services LLP has been offering various financial products and services since 1995. It was formed by two brothers Mr. Hanoz and Mr. Zubin Patel.

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Risk Factors – Investments in Mutual Funds are subject to Market Risks. Read all scheme related documents carefully before investing. Mutual Fund Schemes do not assure or guarantee any returns. Past performances of any Mutual Fund Scheme may or may not be sustained in future. There is no guarantee that the investment objective of any suggested scheme shall be achieved. All existing and prospective investors are advised to check and evaluate the Exit loads and other cost structure (TER) applicable at the time of making the investment before finalizing on any investment decision for Mutual Funds schemes. We deal in Regular Plans only for Mutual Fund Schemes and earn a Trailing Commission on client investments. Disclosure For Commission earnings is made to clients at the time of investments. We are not a Registered Investment Advisor and we do not change any fee to our clients.

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