Are you tied up with ‘Sukanya Samriddhi Yojana Vs Mutual Fund?’ It can be confusing, and that is okay. What would be the best choice for you? Well, it is understandable to make the right choice, especially with your children’s future on the line, and it makes up the utmost importance. Higher education and marriage are two big costs that a parent of a girl kid would have to endure. It necessitates long-term planning because they are expensive. So let us look at what is the best plan for your daughter.

What is the Sukanya Samriddhi Yojana?

Sukanya Samriddhi Yojana (SSY) is a government-sponsored investment and savings program for parents of a girl child. The primary goal of the SSY scheme is to encourage parents to make long-term investments in their daughters’ further education and marriage. The SSY program is an important component of the Beti Bachao, Beti Padhao agenda. The Prime Minister of India announced it in January 2015. This initiative is open to parents who have a girl child under the age of ten. The investment in the SSY plan is guaranteed for 21 years from the day the account is opened. However, one may only invest for a period of 15 years from the day the account is opened.

Investments in SSY accounts are tax-deductible under Section 80C of the Income Tax Act of 1961. These accounts allow for annual investments of up to Rs.1,50,000, with a minimum of Rs.250 required. SSY accounts can be created and operated at any authorized bank or India Post Office branch.

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How Does the Sukanya Samriddhi Yojana Work?

– Parents of the girl child can invest Rs. 1,000 and up to Rs. 1.5 lakhs every year into the Sukanya Samriddhi Yojana Account.

– Deposits can be made only for the first 15 years after opening the account.

– At maturity, the funds will grow with the accumulated compound interest.

– This accumulated sum can benefit your daughter with her higher education, starting a business, or for marriage, all of it once she turns 18.

Calculate your SSY Returns by using SSY Calculator

What are Children Mutual Funds?

One way can be the Sukanya Samriddhi Yojana, but there is another choice and that is children’s mutual funds. There are several child plans and children gift plans offered in the market today, and they have lock-in periods for five years or until the girl child turns 18.

A general high-performing mutual fund can provide much higher returns than a kid plan. If you have a time horizon of more than five years and are willing to accept a rather high degree of risk, you can invest in the funds that match it. If these requirements are not met, and you can even invest in short-term mutual funds. You might have also come across children’s Gift Mutual Funds.

Children’s gift mutual funds aim to raise cash for various life milestones in children’s lives, such as further education and marriage. These mutual funds are classed as balanced or hybrid. Only in the name of the kid may one invest in children’s mutual funds (minor).

How Does a Children’s Gift Mutual Fund Work?

– As a parent or even a legal guardian you can invest in these on behalf of your child.

– This is also a plan that is not only restricted to girl children.

– At maturity, the fund can help for the education and marriage of your child.

– You can also choose your own lock-in period for the fund.

– You can choose funds based on risk appetite and returns.

SSY Vs Mutual Fund – How to Know What is For You

It can sometimes be hard to find out what is the best saving plan for your daughter. Given the two situations, you can also never come to terms with what suits you best. Now that you know what these plans are and how each of them works, you might get a dip into how each one of these would work out for you. Both the options have their pros and cons, and you can only choose one based on your goals.

Is the Sukanya Samriddhi Yojana for You?

Let us see when the Sukanya Samriddhi Yojana would suit you the most. Just say you have a girl child who is one year old, and you plan to invest in the SSY account. Even if you plan to invest ₹20,000 in the year 2021 per year, as the maturity amount, you can earn ₹8,49,000 in the year 2034. So ask yourself a few questions.

– Is this the amount you want during your maturity?

– How much can you save up every year?

– Is this time period a good lock-in for you?

Is the Children’s Gift Mutual Fund for You?

In the Children’s Gift Mutual Fund you can invest ₹80,000 for a year in the form of SIPs for 15 years, and at maturity, you will earn ₹33,58,901, which is compounded from 12% interest. But even here, there are a few questions you could ask yourself before you could jump right in.

– Am I okay with taking up the expense ratio involved?

– Do I have a risk appetite for the mutual fund?

– Can I take up not guaranteed returns?


When it comes to SSY Vs SIP, it can be a little confusing. The returns of mutual funds are higher than that of SSY, but it also comes with its share of risks. On the other hand, SSY is a secure and guaranteed return for the account holder.


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