As a parent, nothing is more important than making the right financial arrangements to secure your child’s future. While you may not know what field of study she will choose, you would want to give her the flexibility to chase her dreams. Given the high rate of inflation in the education costs in India, you will have to plan ahead to give her the best shot at life. And formal education is just a small part of it, you will also want to spend on equipment and training to nurture her creative talents.
Invest early
You should start investing in her education while she is still young. One of the instruments that you should consider includes PNB Housing Fixed Deposit(FD). As capital appreciation is important, choose to invest in a long-term cumulative fixed deposit to get the advantage of compounding interest rates. The current FD rates offered by PNB Housing are high despite the falling rates across the Indian economy. With a long-term fixed deposit, you can lock into the higher rates and ensure that your savings are not affected by the repo rate cuts being announced every quarter.
The PNB Housing Fixed Deposit Advantage
- High-interest rate: PNB Housing Fixed Deposit is a great choice to secure your child’s future as it offers a guaranteed return of up to 8.70% per annum. This among the highest FD rates available in India.
- Safety assured: With a CRISIL rating of FAAA, these deposits are among the safest investments you can make. Your capital is protected and the fixed return allows you to build your plans around it without any uncertainties.
- Loan facility: PNB Housing also offers loans against their fixed deposits at attractive interest rates. You could get a loan for up to 75% of your FD value at short notice. This allows you to meet any emergency expenses without having to dip into your savings and continue to work towards your savings goals.
- Flexible tenure: While we believe that you should start investing when your child is young and choose the longest available tenure, PNB Housing lets you choose a tenure from as short as 7 days to as long as 10 years. You can choose the tenure based on when you foresee that you would need the monies. Remember that you can withdraw from a fixed deposit whenever you like, but this would entail a penalty on the interest earned for the period. This ensures that you continue to stay invested for long and allow your investment to grow towards your goal without any disruptions.
Make multiple deposits
While you may think that you will only need a large amount when your child needs admission in graduate school, in fact, you will need liquidity along the way as well. For example, your child may want to pursue a hobby or an extra-curricular activity that requires some investment. One of the ways to ensure the availability of funds is through laddering of your investment. This also ensures that you do not have to make premature withdrawals and preserves your returns.