Every parent considers saving for their child’s education an important financial goal. A degree from a prestigious university can open up many opportunities. A child may want to pursue a field of education in a global university or a school of high reputation.
Different goals for children can be school admission at the age of four, school trips, college education, postgraduate education, marriage, a down payment to buy a home in the future and more. Once the goal is set you can use the investment calculator to calculate the investment amounts.
The value of the goal will increase with inflation over time. Therefore the further the goal the higher the target corpus. You will have to increase the investment amount with time.
How should you prepare to save?
You will have to prepare before you start investing. You must create an Emergency fund with 6-12 months of expenses. You should not have any high-interest debts like personal loans or credit cards.
The Sukanya Samriddhi Yojana for the girl child has a 21-year lock-in period which can be more appropriate for a parent’s retirement than education. And 150,000 per year can be saved in a PPF account in a child’s name for 15 years.
How do you save for goals?
First, decide on why you want to invest, for how long you want to invest and the cost of the goal today. Assume at what rate the cost of the goal will increase yearly. Decide how much risk you are ready to take for your goal.
Next, formulate an asset allocation based on the decisions made. Start an SIP in funds as per your asset allocation and decide the review frequency of investment. At every review, track and manage your risk and rebalance your portfolio if required. Goal-based investing is an effective way to achieve your financial goals.
Online apps
Now there are online apps available that allow you to invest in the stock market online. Appreciate offers an app that allows you to set goals and reach them efficiently. The app uses AI-enabled algorithms to provide recommendations on where to invest based on your investment goals.
It also allows you to make SIP investments online and start an automated SIP. The app allows you to invest regularly using SIP every 2 weeks, monthly or quarterly. The app uses state-of-the-art security features that allow you to invest without any worry. It monitors all the activities 24x7.
How to setup Goals on Appreciate?
