Which Fd plan is best for your New Born Child?

The birth of a child is excellent news for any family, and excited, they start planning for the newborn child. There are ceremonies and functions linked to the baby’s naming or the birthday parties, the start of playschool at two or three years, and finally the admission to a proper school at around four years of age. For each of these expenses, you might need a large corpus of funds. Rather than having the funds in a savings deposit or availing personal loans, you can consider fixed deposits as per your financial goals.

Why are fixed deposits better for newborn kids?

To manage expenses after the birth of the baby, a good option is to invest in the best FD plan, which offer competitive rates and varying tenures. For example, there are various playschools which can cost between Rs. 40,000 to Rs. 50,000 after three years and in such cases, you can select the best FD plan with a three-year tenure. Hence, you can have your funds parked in a secure place and redeem them when you need it. One of the advantages of a bank FD is that the amount you receive at maturity is guaranteed, because the interest rate is locked into at the beginning itself. The FD interest rate is unchanged during the entire period.

There are different kinds of fixed deposits as per the requirements of the individual with some financial institutions offering fixed deposits primarily for children. Such schemes allow parents or guardians to invest in fixed deposit accounts on behalf of their children. The guardian shall be in charge of the account until the child reaches the age of maturity. Interestingly, some of the fixed deposits schemes for children offer additional protection in the form of insurance as well.

Allahabad Bank SishuMangal deposit scheme-

Allahabad Bank launched the scheme in 1988 with the focus on the welfare of children. The fixed deposit scheme is for minors between the age of 1-15. Under this scheme, the account is under guardianship, and a predetermined amount should be deposited. Any child with Indian citizenship between the age of 1-15 is eligible for this scheme.

Fixed deposits under guardianship for minors-

Multiple banks allow children to open a regular fixed deposit account provided they have a guardian who will handle the account.

In such schemes, the guardian is responsible for the FD account representing the minor. Some banks even provide discounts for minors who open a fixed deposit account with them.

Few banks that allow a minor to open a fixed deposit account are Canara Bank, HDFC Bank, Bank of India etc.


With costs continually rising, you can never predict the expenses that might come your way. Hence it is advisable to consider the best FD plan for your newborn child so that you can tackle the upcoming financial challenges. Such FD schemes are more comfortable to open, do not involve regular investments, require a minimal amount, and so on. Hence it is never too early to plan your finances for the wellbeing of your child.

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