5 Investment Options to Plan Your Child's Higher Education

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak e-Term Plan

Protect Your family’s financial future with Kotak e-Term Plan. Know more

Kotak Assured Savings Plan

A plan that offer guaranteed returns and financial protection for your family. Know more

Kotak Guaranteed Savings Plan

A plan that offers long term savings and insurance in one premium. Know more

Kotak e-Invest

Insurance and investment in one plan with Kotak e-Invest. Know more

Kotak Health Shield

Insurance against medical expenses related to heart, brain, liver and Cancer. Know more

Planning for Your Child's Higher Education? Explore These Investment Options

Planning for Your Child's Higher Education? Explore These Investment Options
  • 26th Apr 2022 |
  • 2,988

With the rising expense of education, it is more crucial than ever to begin saving as soon as possible to reduce your financial load in the future. Student finance for higher education will undoubtedly be costly, and thus it is very important to start investing at the right place at the right time. But before you take this step, your investment objectives must be crystal clear to you. To arrive at a good financial objective, ask yourself the following questions:

  • How much risk can you take with your assets based on your risk appetite?
  • Investment horizon– how long can you keep your money locked in?
  • What is the maximum amount you can invest in a mutual fund?
  • Mode of investment– whether you choose to invest the entire amount at once (which would result in a lump sum investment for a year) or whether you want to invest a small amount at regular intervals (through SIPs)

Now that you’ve established your investment goal and have a higher education finance plan, you can build a substantial corpus by investing in the following:

Mutual Funds Investments

Pooling money professionally, managed by a Fund Manager, is called a mutual fund. There are three broad categories for a mutual fund: equity, debt, and hybrid. For instance, assume you have a one-year-old child, and your investment horizon is likely to fall between 10-15 years, depending on your investment aim. As a result, you should consider investing in equity-oriented schemes for achieving your financial goal for supporting your child’s education. Since this is a long-term approach, the returns will be good enough to help you build that corpus.

You might want to keep your money in an equity fund for a long period. However, after a few years of making such an investment, you can consider moving your investments to liquid funds to prevent significant volatility and assure liquidity based on your future needs.

Gold Exchange Traded Fund (GTF)

Indians have the most confidence in gold investments regardless of all available investment possibilities. On the other hand, physical gold carries a higher risk of purity and comes with additional costs, such as producing jewellery, among other things. Furthermore, dealing with actual gold entails a great deal of effort and price in the form of locker purchases, etc. Gold ETFs, like stocks, are traded on the National Stock Exchange and may be bought and sold at market rates. Such funds are passive assets whose value is tied to the gold price in international markets because they exclusively invest in gold bullions.

Unit-linked assurance plan (ULIP)

Due to fund alternatives that provide steady returns, low levels of risk, or both, ULIP plans have become more popular. As a result, many insurance companies, banks, and financial organisations offer these plans in India, allowing policy purchasers a variety of alternatives to select from. Your money will generate high returns throughout the vesting period, assuring good ROI on the investments and support your little one’s educational costs in the future.

Term Deposits

Like fixed or recurring deposits, term deposits have traditionally been favored by a wide section of Indian investors due to the low risk they entail. Although they give low yields (about 6.5 percent to 7.5 percent for big banks), they are a low-risk investment choice. These deposits are made for a specific time and have limited liquidity. Furthermore, banks impose fines on investors who make early withdrawals. The values on such investments over ₹10,000 per year is taxable.

SSY - A Government policy

Several government-sponsored saving plans also assist investors in accumulating adequate funds for higher education of students. For example, Sukanya Samriddhi Yojana is a government-sponsored savings plan that works well for conservative investors looking to put money towards their daughter’s education. SSY is a low-risk investment that can save you up to ₹1.5 lakh in taxes under Section 80C of the Income Tax Act. However, if you have a girl kid, you are only entitled to invest in the plan. Furthermore, under this arrangement, a family can only open a maximum of two accounts.

While inflation might go down near zero, a key expenditure for the ordinary Indian household is rapidly increasing. One of the largest monetary outflows that households must budget for is their children’s education, and thus, understanding higher education finance is necessary. The key to financial support for higher education is investments, so start investing today to secure your child’s tomorrow.

Kotak e-Invest

In this policy, the investment risk in the investment portfolio is borne by the policyholder.


  • Return of Mortality Charges*$
  • Enhanced Protection
  • Multiple Plan Options
  • Zero Premium Allocation Charges
  • Tax Savings^

Ref. No. KLI/22-23/E-BB/521


Browse our library of resources

- A Consumer Education Initiative series by Kotak Life

Similar Articles

Planning Financial Goals and Objectives of Financial Planning

Receiving regular payouts at various stages of life

ULIP as an Investment for Your Child

Why Should You Invest in Term Insurance And ULIP?

ULIP Investment Strategy: Top Tips to Improve Your ULIP Gains

Successful Financial Planning for Urban Women

Benefits of ULIP as a Child Insurance Plan

Complete Savings Plan for Low Income Earners

Are Money Back Policies Helpful? A Complete Guide

Top 5 Investment Options in 2022 for Healthy Returns

Why Should You Consider Guaranteed Savings Plan for Long-Term Investment?

Building wealth through regular investing

Safe Investment Options with High Returns for FY 2018-19

Learn About Safe Investments with High Returns in India

ULIP Plan as a Gift

How To Diversify Portfolio In 2022?

Which are the Best Investment Plans for Indian Senior Citizens in 2022?

Best Investment Options in India in 2022

How Can a Legal Nominee Claim ULIP Benefits are the Policyholder’s Death?

How To Track ULIP Performance?

How to Plan your Investment to Achieve Periodic Financial Goals?

What are Mutual Funds?

Top 6 Investment Plans Available in India

Savings Plan for Grandchildren

What are the Best Investment Options for Young Adults?

Short Term and Long Term ULIP Plans for Wealth Creation

Factors Affecting Stock Markets

Best Long-Term Savings Plans in India in 2022

What is Fund Switch in ULIP? And ULIP Fund Switching Techniques

ULIP Benefits You Can Avail from Early Investing

How Do One-Time Investment Plans Work?

How to Cancel ULIP Policy?

What is the Importance of Saving Money?

Can ULIP Help in Achieving Short-Term Financial Goals?

How is Compoud Annual Growth Rate (CAGR) Calculated in ULIP?

ULIP vs FD - Which is Better and Why?

Difference Between Guaranteed Savings Plan and ULIP

How to Plan Savings from Salary?

What are the Best Investment Options for Beginners or Amateur Investors in India?

Things to Know Before Buying an Endowment Plan

How to Manage Your Portfolio Like a Professional?

Difference Between Guaranteed Savings Plan and Guaranteed Income Plan

Debt ULIPs vs. Debt Mutual Funds: What's the Difference?

Learn About Safe Investments with High Returns in India

What are Tax-Deferred Savings Plans?

Top 5 Principles That Need to be Followed for Wealth Creation

Different Types of Endowment Plans

What is a Savings Plan and What are is Benefits?

Important Questions You Must Ask Yourself When Buying a ULIP Plan

4 Important Tips to Maximize Gains with ULIP Investments

Best One-Time Investment Plans in India

How to Start Saving Money in 10 Simple Ways?

What are Some of the Safest Investment Options in India?

Customising investments to manage your wealth

3 Tips to Buy Guaranteed Savings Plan

What are the Best Short-Term Investment Plans with High Returns?

Endowment Plan vs Fixed Deposit?

What is better - Guaranteed Savings Plan or Fixed Deposit?

Top 10 Investment Strategies to Create Wealth

4 Benefits of ULIP Fund-Switching Feature

Why Should Parents Invest in Endowment Plan?

Beginner's Guide to Wealth Creation: Meaning, Strategies, & Importance

How Much Wealth Can You Create from ULIP in 10 years?

Best Investment Options to Cover Your Child's Education

How to Fulfil Your Financial Goals in the Next 10 Years?

How Does an Endowment Plan Work?

Do You Know the Difference Between Savings and Investment?

Basics of Guaranteed Savings Plan

Asset Allocations in ULIP - Know the Top Benefits

Which is a Better Investment - Mutual Funds Or ULIP?

Importance of Portfolio Management

What's Better for Your Child's Education? Child Plans or Mutual Funds?

What are the Best Investment Options For Females?

Why Do You Need A ULIP Plan - All You Need To Know

Early Investing and the Power of Compounding

Investments Options to Buy a house in India

How to Make Your Financial Portfolio?

Which is Better – FD, Mutual Fund, SIP, or ULIP?

Creating a second source of income with life insurance

What is ULIP Renewal?

Why ULIP is Better Investment for Long-Term Wealth Creation?

Difference Between Passive and Active Investing

What are the Best Investment Options for Students in India?

How to Manage Inheritance Money?

What are Deferred Savings Plans?

Is This The Right Time To Invest In ULIP? Why or Why Not?

Who Should Invest in Savings Plan?

How to Increase Net Worth Along with Family Protection

उच्च रिटर्न प्राप्त करने के लिए सर्वश्रेष्ठ इन्वेस्टमेंट विकल्प

Investment Options for NRIs in India

Are Gains from ULIP Sale Taxable?

Why is Portfolio Diversification Important? How to Diversify Your Portfolio?

How to Plan Your Child's Education - A Step by Step Guide