Investment Planning

StP - Investors can systematically transfer a fixed amount from one scheme to another at regular intervals through the systematic transfer plan (STP). For example, you can transfer a pre-defined amount on a specified date from a debt investment into an equity scheme; this will not only generate returns on the debt investment but also negate the risk of one-time investment in equity. On the other hand, investors can lock gains from equity funds by transferring the same to short-term debt funds where the returns are less volatile. This is typically done when goal amount is achieved before time or when the goal is near - it reduces the effect of any short term volatility in the equity market on the investor’s portfolio.

SWP - To meet the need for regular child-related expenses, such as education fees, investors can also look at systematic withdrawal plans (SWP) which allow redeeming a specified sum at a pre-determined date by providing instructions to the fund house.

Summing up
To accumulate wealth to secure children’s future and also protect them against uncertainties, parents should not only save regularly but also start investing early.