Many parents start investing for their safe future only a few years after their child’s birth. This is also a good strategy. If parents start investing with time, then there will be no shortage of money during children’s education, higher education and marriage. Now the question arises that where would it be better for children to invest? Financial experts say that mutual funds are an excellent option for long periods. The reason for this is that you can make large funds in the long term by investing through SIP. How to start SIP in the name of children? These questions have been answered by Radhika Gupta, CEO of Edelweiss Mutual Fund.
Radhika Gupta gave 4 frequently asked questions, read
1. If a minor does not have a PAN, can I open a mutual fund folio for my child?
Answer: Yes, a minor pan is optional to make folio. Only the parent’s PAN is mandatory. Let us tell you that a mutual fund followo number is a unique identification number that is given to every person investing in mutual funds. It is an alphanumeric code. With the help of folio number, all transactions related to mutual funds are tracked into the same account.
2. Which documents are required for a minor to make folio?
Answer: You will also need documents to evidence of the parent’s PAN as well as a relationship, such as a minor’s birth certificate, passport or document issued by the court. PAN is not mandatory for minors.
3. Can I take SIP from bank accounts of both guardian and minor?
Answer: Yes, bank accounts of both parents and minor can be used for SIP membership and lump sum transactions. The redemption amount will be deposited only in the bank account of the minor.
4. How long does it take for a minor to prepare folios?
Answer: Under the verification of minor/parent relationship documents, it can take 2 working days to prepare minor folios. The first transaction can be started when creating folio or after making folios.
