Mrin Agarwal, the Financial Educator & Director at Finsafe India Private, in an exclusive interaction with CNBC-TV18, delved into the topic of planning for children’s education. The conversation centered around key inquiries: when to commence, how to kick-start the process, and where to strategically allocate funds for optimal outcomes.

Agarwal emphasised the importance of initiating the planning phase at an early stage. Considering the inflation rate for education fluctuating between 7 to 10%, initiating investments at the earliest emerges as a prudent move.

She highlighted, “Starting early grants you the advantage of time for your investments to grow. It also potentially permits a higher risk threshold.”

She further stressed on the importance of factoring in present education expenses when calculating future higher education goals. "As future costs remain uncertain, we can utilise current expenses and project them forward accounting for inflation," she explained to CNBC-TV18.

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She further mentioned that there are many calculators available online which can help in calculating how much one would need to save for child's education.

When choosing mutual funds for child's education, Mrin Agarwal suggests different options based on the investment horizon. For a period of less than 5 years, short-duration debt funds are recommended.

"If you have a longer timeframe of 5-7 years, balanced funds are a suitable choice. For an investment horizon exceeding 7 years, Agarwal recommends considering index flexicap, midcap, and small cap funds. Additionally, specialised child education plans are advisable for those with an investment horizon of more than 7 years," she said.

For full interview, watch accompanying video

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(Edited by : Anshul)