Sumit and Priya -Receiving Shagun Gifts
Challenge:
Sumit and Priya were blessed with twins and celebrated the occasion with a naming ceremony. They received monetary gifts in the form of "lifafas" (money shagun envelopes), amounting to amount approx Rs. 87000 for each kid. Family members suggested various traditional investment options, including fixed deposits, gold, Sukanya for daughter and PF for the son. However, they were unsure about the best way to secure their children's future.
Trustedarms Approach:
- Understanding Their Goals: We began by congratulating Sumit and Priya and understanding their aspirations. Their primary focus was to secure their children’s future and plan for their higher education.
- Educating About Future Costs: We explained how education costs have increased over the years and education inflation stands at 8-10% pa and shared projections for both domestic and international education expenses. We highlighted the importance of starting early to achieve their goals with minimal financial strain.
- Suggested them to add Rs. 63000 to the shagun money and invest Rs. 1.5 lacs immediately in each kids name and continue adding Rs. 1.5 lacs every year.
- After analyzing their risk profile, we recommended investing in HDFC Children's Gift Fund—a mix of 65% equities and 35% bonds. We also introduced the SBI Children's Gift Fund as a comparable option. Both funds offer strong growth potential, reduced volatility, and superior tax benefits, outperforming traditional investment options like fixed deposits, gold etc.
- We demonstrated how an upfront investment of ₹1.5 lakh and adding ₹1.5 lakh every year could grow to approximately ₹1 crore by the time their children reach higher education age. In comparison, traditional options like fixed deposits would yield only about ₹32 lakhs, while also carrying reinvestment risks as interest rates decline.
Outcome
Sumit and Priya appreciated the clarity and long-term benefits of the suggested plan. Confident in their ability to let the money grow without interruptions, they chose to invest in the recommended funds. This decision ensured a well-planned and secure future for their twins, leveraging the power of early investments and compounding.
Other Case Studies
No case studies found.
