Why Invest In A Fixed Deposit Scheme For Children?

Are you considering saving money for your children but worried about the growing inflation? Interest rates for savings accounts are not that great, and they will not be able to balance the effects of inflation.

But considering the high fear of losing money due to market risks and scams, you should consider investing in a safe and assured method such as a Fixed Deposit.

Fixed Deposit Interest Rate is higher than just storing your money in a saving account and keeping it safe as it is not subject to market fluctuations. But what is it, why you should invest in one, and how to invest in one?

What is a Fixed Deposit?

A fixed deposit is a form of investment in which you invest a one-time sum of money, set up tenure, and cumulation frequency to invest and receive the said amount at maturity. This is the safest form of investment as it is not affected by market conditions and provides the amount you see on the day of the investment.

This feature makes it extremely popular and is the most popular investment choice among Indians.

What are Fixed Deposit Schemes for Children?

Several schemes are available to put up an FD for your child. You can do so as early as they are a year old. This provides benefits like higher interest rates, flexible tenure, and a low minimum deposit amount.

One thing to keep in mind is that if your child is below the age of 14, you can have an FD of up to Rs 1 Lakh, and if they are above 14, then there is no maximum deposit limit unless set by the provider. 

Which is the best fixed deposit plan?

The best FD plan lets you stay ahead of the inflation curve so that your current money does not lose value and has less worth. This is especially important when planning so that the money you save for your children’s education or marriage does not reduce in value.

Tenure matters for fixed deposits; the longer your tenure, the more returns you will receive. For example, if you make an FD of Rs 1 lakh for ten years at 7.1%, you will double the money and get more than Rs 2 lakh. And especially if you invest your money into multiple FDs, you can further multiply your returns on investment.

How to invest in an FD?

It is effortless to invest in FD nowadays, and these are the steps I followed to invest in FD.

  1. All you need to do is to compare different plans to choose your preferred investment partner. I landed on Bajaj Finserv as my partner for the FDs.
  2. I then used their Fixed Deposit calculator to calculate FD interest, simulate the different tenures, and see the assured returns.
  3. This will help you decide the best amount and tenure to invest in, along with the interest payout.
  4. Once that is done, all you need to do is to fill in some KYC details and submit the form.
  5. You should be good to go, and if you have any questions, there is also a callback option for you to speak with their executives and understand the plan better.


This is how I invested in fixed deposits. I have made multiple deposits, and whenever I get some extra money or bonus, I just create another FD and see the money grow. The FD calculator helps me do so quickly and conveniently.

I have been keeping this habit following my mother, who saved a lot of money and then used it to fund my education in the UK. This habit has been helping me pay for my child’s education and expenses without worries, and you could do it as well.

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