Fixed Deposit for Children
One of the most important decisions that you will have to make as a parent is investing in your child’s future. A fixed deposit (FD) for children is a simple and reliable way to save and build wealth for your child’s education, wedding or any other significant milestone. Investing in an FD for children with Shriram Finance helps you benefit from the power of compounding without the risk of market volatilities.
With our FD, you can ensure that your child has all the funds they require to chase their dreams and build a life they want to with confidence. Shriram FD provides one of the highest interest rates of up to 8.15%* p.a., inclusive of 0.50%* p.a. for senior citizens and 0.05%* p.a. for women depositors.
Benefits of a Fixed Deposit for Children
A fixed deposit from Shriram Finance opened for children comes with several advantages for parents and guardians looking to invest in their child’s stable future. Here are some key benefits of booking an FD for children:
Early Start
These FD schemes can be opened for children as young as one-year-old. This gives you a longer time frame to make your investment, thus maximising potential returns.
Minimum Investment
Most FD schemes for children can be opened with a low initial deposit. This makes them accessible to most parents with varying income levels. With Shriram FD, you start with a minimum of ₹5,000.
Flexible Investment
Unlike mutual funds or stocks, FDs do not require regular payments. You can invest a lump sum amount while booking an FD and then let it grow steadily.
Goal-oriented Saving
From saving for education to a wedding, a fixed deposit can be a great way to save for your child’s future. Fixed deposits invested during the child’s early age can be renewed until they turn 18 years old, making it a goal-oriented investment.
Reliability and Stability
Fixed deposits are a low-risk investment option. Your principal investment remains locked in for the tenure you choose, and you earn a steady interest rate on the deposited amount. This keeps your savings protected from market fluctuations, offering you stability and reliability.
Factors to Consider When Choosing a Fixed Deposit for Children
Here are a few factors that you may want to consider when choosing an FD scheme for children:
When booking an FD, it is important to understand the interest rates you are getting. The interest rate may depend on the type of FD scheme, tenure, etc. Shriram Finance offers up to 8.15%* p.a. (inclusive of 0.50%* p.a. for senior citizens and 0.05%* p.a. for women), making it a compelling choice to earn high returns and give your child a bright future.
Always choose a maturity period that suits your child’s future requirements, like education, wedding, etc. Tenure options at Shriram Finance start from 12 and go up to 60 months. You can also choose from multiple payout options like monthly, quarterly, half-yearly and yearly.
Ensure you have checked FD’s credit ratings before making an investment. Shriram FD is backed by strong credit ratings of [ICRA]AA+ (Stable)" by ICRA and "IND AA+/Stable" by India Ratings and Research, making it one of the more reliable options for your child’s future.
How to Invest in a Fixed Deposit for Children
Opening an FD for your child with Shriram Finance is a simple and straightforward process:
- Step 1Register using your mobile number, pin code, and residency status. Click 'Invest Now'.
- Step 2Choose your desired deposit amount and select your tenure and payout option based on your preferences.
- Step 3Enter your PAN and Aadhaar details, verify via OTP and complete KYC with a quick selfie.
- Step 4Provide occupation details and add your bank details for maturity credit, nominee information and set the maturity instructions.
- Step 5Complete declarations and make payment via net banking, UPI or debit card.
- Step 6Receive instant confirmation via SMS/email and get your digital FD certificate within 7 working days.
Here’s an example you can take a look at to understand how an FD for children from Shriram Finance can help you benefit from compounding. Let’s assume you want to invest ₹50,000 for 60 months under the cumulative scheme. This means that you will receive the principal you invested, along with the interest earned on maturity.
| Money Invested | Interest Earned | Return Received |
|---|---|---|
| ₹50,000 | ₹22,126 | ₹72,126 |
How to Withdraw the Matured Amount from a Fixed Deposit for Children
Withdrawing the matured amount from your FD is simple. If they are minors, the guardian or the parent can withdraw the matured amount from an FD for children. Here is the instruction on how to withdraw the matured amount from Shriram FD:
- While opening your FD with Shriram Finance, you will be asked to choose how you want your FD amount to be handled at maturity.
- You can either opt to receive the matured amount directly into your linked bank account or select auto-renewal to reinvest the amount for another term.
- To receive your matured FD amount automatically to your linked bank account, choose the option "Refund on Maturity."
- This helps with a smooth and automatic transfer of the funds on the due date.
- Please note that if you would like to withdraw your FD investment early, a penalty fee will be charged. •
- It is wise to keep your FD investment locked-in to maximise your returns on maturity.
FAQs
How do minors get an FD to their name?
FDs for minors can be booked with a court appointed guardian or a parent as joint account holders. This ensures financial discipline and teaches your child the value of saving money early on.
How can I choose a suitable FD plan for my child?
Parents should consider factors like the interest rate offered, tenure and payout options, reputation of the financial institution, and other additional features and perks associated with the scheme before choosing the right FD for their child.
What is the investment limit to open an FD for minors?
To open an FD for minors with Shriram Finance, you can start your investment from ₹5000, and the investment can be increased in the multiples of ₹1000.
Can an FD for a minor be closed before maturity?
Yes, premature withdrawals are available, but they attract a penalty.
Who is the nominee for a fixed deposit for children?
For an FD for children, the nominee can be any individual who is a major.
Is premature withdrawal available with a fixed deposit for a girl child?
Yes, premature withdrawal is allowed for fixed deposits intended for girl children but there is a penalty associated with it.
Is it safe for students to invest in fixed deposits?
It is important to understand that all investments come with some inherent risk. But for FDs, the risk is usually minimal. It is, therefore, a smart choice for students to invest in an FD for steady growth of investment.
What is the benefit of investing in a fixed deposit for my child’s education?
Investing in a fixed deposit for your child’s education offers stability and steady returns. It helps in building a dedicated fund for future educational expenses. This allows for financial preparedness.
Disclaimer
With regards to deposit-taking activity of Shriram Finance Limited (’SFL’), viewers may refer to detailed information and T&C provided in our application form available at https://www.shriramfinance.in/downloads . The Company is having a valid Certificate of Registration dated 31st January 2023 issued by the Bank under section 45-IA of the RBI Act. However, the Reserve Bank of India does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company.
