look news india
New Path for the Future of Children, New Delhi: It is the dream of every parent to financially secure your child’s future. The National Pension System – NPS has emerged as a great option to make this dream come true. There is no official scheme like “Vatsalya Yojana” in NPS, but you can create a huge fund by opening an NPS account in your child’s name, which will be helpful in meeting his studies, marriage or other needs in future.
Let us know how you can make a fund of crores of rupees for your child through a disciplined investment.
How does NPS work for children?
Legally, any parent can open an NPS account in the name of their minor child. This account will be operated by parents until the child turns 18 years old. When the age of 18 is completed, the account is handed over to the child. When the child is an adult, he can continue this scheme if he wants or withdraw money from it according to the rules.
Fund of ₹ 11 crore with an investment of ₹ 1.80 lakh: What is its mathematics?
This figure reflects a long -term investment and the strength of compounding interest on it. It is not a certain -returned scheme, but is based on a calculation.
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Initial investment: Suppose you in the first year of your child’s birth to his NPS account ₹ 1.80 Lakh Invest lump-sums.
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Estimated return: A large part of the investment in NPS can be installed in the equity (stock market), on average in the long term 10-12% Can be expected to get returns of.
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Duration: If this investment persists till the age of 60 years of the child (ie for the entire 60 years), then it can become a large amount with the effect of compound interest.
According to the calculation, If an average annual return of 12% is received on an average investment on an initial investment of ₹ 1.80 lakh, then this amount increased to almost in 60 years ₹ 11.39 Crore Might be possible. It is important to note that this figure is completely based on an estimated return and very long investment period. Market performance can affect returns.
Planning Benefits:
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Benefits of early start: Starting investing at an early age of the child provides maximum benefit of compound interest.
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Long -term investment: It is a long -term investment plan that creates a strong economic basis for future big goals.
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Professional Fund Management: Your money is managed by professional fund managers.
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tax benefits: On investing in NPS, there is also the benefit of tax exemption under Section 80CCD of the Income Tax Act.
Investing for the future of the child is a sensible decision, and the NPS offers an attractive option due to its flexible investment structure and high returns in the long term.