Sunday, 23 January 2011

Fidelity India Children’s Plan a Mutual Fund for your children’s financial needs

Fidelity Mutual fund came with Children’s Plan in the name of Fidelity India Children’s Plan, an open ended Mutual fund for satisfying the needs of your children such as education, marriage etc. This is a hybrid fund (A Mutual fund which is investing in a mix of stocks (around60%) and bonds (around 40%)-Single Mutual fund for diversified investments). This plan includes three mutual funds focused for education, Marriage and saving. Investment in Fidelity India Children’s Plan can be made in the names of children below the age of 18 years.

The New Fund Offer (NFO) already opened on 17th January, 2011 and the closing date is 31st January, 2011. This is the first time offer from fidelity mutual funds to satisfy the children’s need of the investor.

The important features of this Fidelity India Children’s Plan is that this scheme invest the pooled money of investors in debt and money market instruments for the investors who do not like high risk investments such as equity schemes and also for the investors who are very near to their financial goals. The marriage fund includes a portfolio of Gold ETFs also to protect from the rise of gold prices.

The Three funds of Fidelity India Children’s Plan are with varying asset allocation levels. The Prot folio of Education Fund is around 70% equity and 30% debt and over a long period of time this is able to provide funds for children’s education. The Portfolio of Marriage Fund is around 70% equity, 20% gold ETFs and 10% in debt and Savings Fund is up to 100% in debt and money market instruments to provide stability.

All these three type of funds are available in both growth and dividend options and the dividend option is also available in dividend payout and dividend reinvestment option.

There is an exit load for these fund and the exit load of Education and Marriage funds are 3% within one year, 2% between 1 and 2 years and 1% between 2 to 3 years.  But the exit load in Savings Fund is only 0.50% for the redemptions within 1 year.

The minimum amount of investment is Rs. 5,000 in onetime payment option and Rs. 500 (monthly, quarterly, half yearly or annual installments with the total minimum investment of Rs. 6000) in Systematic Investment Plan (SIP) option.   Systematic transfer (STP) and systematic withdrawal plans (SWP) are also available for this scheme. This scheme allows free switching between different options of the same fund or between different funds within the Plan and in the case of transfers under STP.

As per the available information this is a tailor made plan for the investment goals of investors' children and as a hybrid fund this helps the diversity in investment also. It seems that the first attempt of children’s mutual fund plan from fidelity mutual fund is welcomeable.

Download a free guide from fidelity teaches you how to save for children

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  1. [...] We wish to give our children the best education and hope that they should be grown up with best personality and education.  But when did you plan this. A famous child physiologist said that if you want a child with best behavior and personality you should plan two years before the birth of the child. Here for the higher education of your children you should plan at least the birth of the child. How much early you start investing for your children that much time lag you will get to grow your money to reach the required amount while this investment and the expense of education also associated with inflation. Inflation decreases the value of your money and at the same time it increases the amount of money you have to spend for the education of your children. [...]

  2. Please Email me details of Children's mutual fund.

  3. please send us the details of children fidelity funds