How It Helps
Start by entering your child’s current age, the age at which they’ll need funds (say, 18 for undergraduate or 22 for postgraduate), today’s cost of the course, and an assumed inflation rate. The calculator projects the future cost based on education inflation—which is often higher than general inflation. It then tells you the monthly SIP or lump-sum investment required to reach that target.
Why Include Equity Funds?
For goals 8–15+ years away, Equity Funds are powerful because they aim to beat inflation and compound over time. Pair them with the calculator’s projections to create a disciplined plan. You can start with a diversified large-cap or index fund for stability, and gradually add flexi-cap or hybrid funds as you get closer to the goal, rebalancing into debt for safety in the final 2–3 years.
A Quick Example
- Current course cost: ₹15,00,000
- Education inflation: 8%
- Years to goal: 10
- Future cost: ~₹32,38,000
To reach this, assuming 11% annual returns from a blended portfolio, you’d need an SIP of roughly ₹17,500–₹18,500 per month. As income grows, use a Step-Up SIP (increase contributions by 5–10% annually) to stay ahead of inflation without straining cash flow.
Smart Tips
- Start early: Even small SIPs compound meaningfully over a decade.
- Automate and review yearly: Adjust for actual inflation and returns.
- De-risk near the goal: Shift gradually from equity to short-duration debt or liquid funds in the last 24–36 months.
- Protect the plan: Consider term insurance so the goal isn’t compromised.
Final Thought: A Child Education Calculator gives you a clear roadmap, while Equity Funds provide the growth engine. Combine disciplined SIPs, periodic reviews, and timely de-risking to turn your child’s education dream into a fully funded reality.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.