When it comes to personal or retirement investment planning, we are often well aware of the available options in the market. Based on this awareness, we tend to make instant decisions about the investment avenues we wish to pursue. However, when it comes to making investment and financial planning decisions for our children, especially daughters, we often lack the same sense of urgency. At times, we even find ourselves confused about the types of investment options needed to be pursued.
While Sukanya Samriddhi Yojana (SSY) is a popular choice for long-term investment in a girl child’s future, many people tend to limit their options solely to it. However, it’s essential to explore numerous other investment avenues available for her.
As one looks to diversify his portfolio for retirement planning and other financial goals to ensure decent returns and safety, in the same way, it’s important to broaden his investment horizon when saving for his daughter’s future. While Sukanya Samriddhi Yojana is a popular choice, exploring other avenues is equally important. Considering the impact of rising inflation, one will need additional funds to meet expenses for higher education or marriage.
Also Read: What are the tax benefits of Sukanya Samriddhi Yojana?
Investment avenues available for your daughter’s future finance
Tushar Bopche, Co-Founder and Head of Strategy, Invest4Edu, shares his insights with financialexpress.com on the various investment avenues available in India to secure the future of a girl child.
Equity, debt, gold and real estate — all four asset classes are important pillars, according to Bopche, who underscores asset allocation and asset diversification as two important factors in the wealth creation process.
Delving deeper into each asset class, he says equity-linked instruments (direct equity, ETFs, mutual funds and ULIPs) help to build a long-term growth-oriented corpus.
Debt-linked instruments (bank FD, corporate FD, NCD, debt mutual fund) help to build a regular income portfolio, says Bopche.
“Gold helps you diversify into a more liquefiable asset that is non-correlated to other asset classes. Historically, it has long-term growth potential and universal acceptance,” Bopche said, highlighting gold’s unique appeal as an investment tool.
Among others, he suggested investment in real estate, stating that real estate is a tangible asset which helps in generating income as well as diversifying portfolios.
“As a parent, you can start small with equity-linked and debt-linked instruments,” he advised parents.
Challenges in promoting financial security for girls
In a country like India, there are some unique challenges in promoting financial security for girls due to some cultural and societal norms as well as behavioural patterns that linger for a long time. As a result, these factors play a significant and decisive role in the the financial decisions of parents.
Talking about these challenges, Bopche said, “We are seeing a shift in thought processes towards girl child upbringing. Things are changing, and people are giving important weightage to a girl child’s future. But, we still have a long way to go.”
Promoting financial security for girls in India involves unique challenges due to deep-rooted societal norms and cultural practices that influence perceptions and behaviours around gender and finance, says the Invest4Edu founder.
Early marriages, educational disparities, limited access to financial resources, cultural bias, old patriarchal controls and values, and social-economic barriers are the major challenges that we still need to overcome, he says, adding that understanding and addressing these challenges is crucial to fostering gender equity and empowering girls financially.
The government has done a lot in terms of initiatives and is still playing an important role in narrowing this gap.
The Centre and respective state governments have got many schemes running to promote girl child education. Initiatives like free meals, bicycles, free education until 12th and scholarships & incentive schemes have yielded a very encouraging result for society. Several non-government organisations (NGOs) along with large corporate houses have been playing their part in running multiple initiatives for girl children too.
