I’m 31-years old. I have two sons, one aged 4 years and the other, 9 months. I want Rs 20 lakh for their education after 15 years. I am already investing Rs 1,500 a month in Birla Sun Life Frontline Equity and HDFC Equity, and Rs 1,000 a month in Reliance Regular Savings Equity via SIPs. I can invest another Rs 3,000 a month. Please suggest some funds. Also, do you think it is a wise idea to save for education by investing via SIPs?
-Rashi Gupta
Yes, investing in equity via SIPs is a good way to accumulate over the long-term. You don’t necessarily have to look for products that have ‘children’s plan’ or something like that embedded in their name. When you’re sure of your timeframe, you can invest this way.
For a period of 15 years, you’ve chosen good funds. You don’t need to add more funds to your portfolio, just spread the additional Rs 3,000 that you can invest across the funds you already own. If your investments earn you even a modest appreciation of 12 per cent over the next 15 years, you will be able to accumulate a corpus of Rs 35 lakh. Hence, you're on the right track; continue investing regularly.
This article was originally published on April 23, 2012.
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