Go girl, chase your dreams
The best gift you can give your daughter is to set her up for success by making her financially independent!
Last month India celebrated the National Girl Child Day. However, in addition to celebrating the girl child, we also need to ensure that we set them up for success in future by making them financially strong and independent.
More than the issues of gender equality and women empowerment, on days such as National Girl Child Day, we need to address the need for financial independence of a girl child. Financial stability is a concern that parents always have for their children, especially in the case of a girl child. Be it for her education or for her marriage, investment done at the right time can help her build her future.
When it comes to ensuring financial freedom for a girl child, the sooner the start, the higher the returns, must be the rule. The next important thing to consider is where to invest to achieve higher returns, which depend more on how long one has invested than on how much one has started with. Early start can increase the chances of compound interest and subsequent higher returns.
Such financial literacy must also be passed on to the girl child to not just make her financially stable and independent, but also to help her make an informed choice while selecting the right investment plan in the future.
This brings us to the most important question. What can be the best investment plan for a girl child? While there are many investment plans and schemes offered for girl child, like Sukanya Samriddhi Yojana, Children Gift Mutual Fund, Systematic Investment Plan, Unit Linked Insurance Plan, and National Saving Certificate, amongst many others, the best bet is the Systematic Investment Plan (SIP).
With SIP, you can have a disciplined approach to saving with an option to start with small amounts, as little as Rs 500 per month. The focus must be on accumulation of units and long-term gains. With its potential to grow over the period of time, it can be an ideal gift option for the birth or marriage of a girl child, against the regular shagun, which is just one-time token. The unique feature of SIP is that it allows you to buy more units when the market is low, and buy less when the market is high. This is because of the inherent feature of SIP, where at every market correction, you will buy more, reducing your cost of investment, making you gain higher. Besides, SIP provides great flexibility. You can withdraw the full or a partial amount from your investment, without incurring any losses. You can invest lumpsum amount when there is a correction in the market during the journey of investment and enhance your accumulation. The inherent operational principle of SIP is that it works by compounding interest on any investments you make. So, if you start investing early, and stay invested for a long time, you will reap optimum returns from the SIP.
So, this financial year, plan to give your girl the gift of financial freedom and independence!
