Investing in mutual funds for children is a thoughtful and strategic way to build financial security for their future. Whether you're planning for their education, marriage, or giving them a financial head start in adulthood, mutual funds offer a flexible and growth-oriented investment option.
Mutual funds pool money from many investors to invest in a diversified mix of assets such as stocks, bonds, or a combination of both. By starting early, you can take advantage of compound growth, allowing even small investments to grow significantly over time.
There are child-specific mutual fund schemes available, often with lock-in periods and tax benefits, designed to align with long-term financial goals. These funds are professionally managed and typically come with options based on your risk tolerance and investment horizon.
In short, mutual funds can be an effective tool for parents or guardians who want to secure their child’s financial future with disciplined, long-term investing.
Let’s say your child is 5 years old today, and you begin investing ₹10,000 per month in a mutual fund through a Systematic Investment Plan (SIP). If you continue this investment for 20 years, until your child turns 25, and the fund delivers an average annual return of 12%, your total investment of ₹24 lakhs could grow into a corpus of nearly ₹1 crore (₹99.91 lakhs).
This could be a powerful financial cushion to support your child’s higher education, a first home, or any life goal. By starting early and staying consistent, you're giving time and compounding the chance to work in your child’s favour, turning small monthly investments into significant long-term wealth.
A SIP calculator (Systematic Investment Plan calculator) is a financial tool used to estimate the future value of your investments when you invest a fixed amount regularly (usually monthly) in mutual funds via a SIP.
Also Read: Invested ₹5 Lakh in HDFC Gold ETF 5 Years Ago: How Much is it Worth Now?
Investing early in mutual funds for your child’s future is one of the most impactful financial decisions you can make. A disciplined monthly SIP of ₹10,000 not only builds a habit of consistent saving but also leverages the power of compounding to create meaningful wealth over time.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.
Published on: Jul 25, 2025, 12:25 PM IST
Sachin Gupta
Sachin Gupta is a Content Writer with 6+ years of experience in the stock market, including global markets like the US, Canada, and Australia. At Angel One, Sachin specialises in creating financial content that simplifies complex market trends. Sachin holds a Master's in Commerce, specialising in Economics.
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