Starting up a family is a whole new phase in the life of parents, but with that comes a bag of responsibilities for a lifetime. The good news in the family is also a financial, mental, and physical responsibility that has to be maintained in the long run by the parents. However, the other two comes from the love you hold within yourself for the child, financial responsibility is the one that needs maintenance from the very beginning to give your child a secure, healthy, and good future.

If you are also a new parent and the big question of how to save money for kids haunt and scare you, we will tell you some of the tips and tricks that you can opt to save funds for your ward’s future.

Ways to save money for kids

Financial planning and money savings is the journey which is different for everyone in a distinguished way but why do we save money? Solely because we can't foretell destiny. Consequently, the need to save funds for the future is vital. Many save for retirement, a brand-new car or a dream apartment of their own, long vacations, luxury bags or shoes, etc.

Presently, people are more concerned about the fate of their children and want to know the best way to save money for kids. Moreover, there is no reason they should not be because of the skyscraping schooling expenses of schools and universities. So, if you don't want to worry, later on, begin planning and saving to ensure your wards secure future.

1. Evaluate your children's future need

You must consider and look for the requirements of your kids before brewing any financial plan for their future studies. After assessing this, start pursuing those wants-based plans, so you are on the right path. There can be some expenditures that may occur in the future, so you should anticipate them as well.

2. Start early to save: Open Kids Savings Account

Most of the banks and financial institutions offer kids' savings account in the present times that can be co-owned by the parents as well. These savings account can help children develop the habit of saving and financial planning; rather than spending all their money, they will learn different ways to save for their future needs.

savings account for kids come with different benefits and profits that could be used to save money for their higher education, marriage savings and more, with the added advantage of earning higher rates of interest on the saved amount

3. Start saving early to invest less in the future

Let us take an example to understand this - Per se, Mrs. Kapoor has a daughter who is 8 years old right now. Her daughter will get married in17 to 20 years. As per present times, the cost of getting married in sky-rocketing and with the rate of inflation rising each year, she will have to spend quite a lot of money on her daughter’s wedding and if she begins her financial planning now, she will need to invest around certain amount each month, but if the investment process is delayed by five to seven years, she needs to invest almost double the amount, which will be more on the difficult side.

It is a great example, which explains why investing money for your child's future from an early time will be beneficial in the future.

4. Savings for Kid's Education

Saving for your kids mean saving for their future as well. The first thing that most parents worry about is the education part. In the present frame of time, even the school of a kindergarten kid can draw a hole in your pocket. Hence, planning on different levels for your kids will come handy for you to educate him or her in the way you wish and desire and is one of the best money saving tips for kids.

Initially save for the school studies in a zero balance savings account and as time passes and you ward his sure what they want to do for higher studies, start the planning for the same when they are teenagers. By dividing your savings journey for their education, it will not be a huge burden on you as well.

When should you begin Savings for your Kids?

Beginning a family appears with a wide range of sentiments and huge responsibilities. Newborns require a lot of endurance, energy, nourishing, and not to forget the money. These little munchkins grow up quickly and shortly will be gone off to university, get married to shape their future. While teenagers might not require hands-on parenting as infants do, they still need funds to pursue higher studies, getting married and health prospects as well.

There are many ways for pupils to pay for college, but nothing is more efficient than thoughtfully saving money for kids, and the process should start from the very time they are born.

With the ways mentioned above, you must start the planning process as quickly as they are in the world. In addition, you must also negotiate with the plans as and when you realize the kind of studies your ward wants to pursue their higher education.

In addition, we also need to save money for the healthy life of our kids. We would never want to think on those lines, but uncertainties never come with a knock on the door. Saving some amount for the better health of your child from the very beginning will never put you under pressure in the times of need. Begin saving small amount from the time the child is born and stay stress free in the longer run.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.