Investing for your child’s future – mutual fund investments can help you in achieving your financial goals.
MF investment in the name of a minor child
It is possible to make an investment in any mutual fund in the name of a minor child with either the parent or a legal guardian as guardian in the folio. There is no joint holder allowed.
Documents required for the investment
You must provide proof for the child’s date of birth and age. A copy of the age proof – birth certificate or passport copy or any other valid proof and relationship of the guardian with the minor.
SIP or STP in the name of a minor child
A mutual fund investment through means like SIP, STP can also be done in a folio held by a minor. However, the instruction for SIP or STP will be active only till the child becomes a major.
What happens when the minor child becomes a major?
When the minor becomes a major all transactions such as standing instructions, SIPs etc. will be suspended. The folio will be frozen and cannot be operated by the guardian any more. The minor has to submit an application form along with prescribed documents to change the status of the folio from `minor’ to `major’.