Axis Children’s Gift Fund is an open ended balanced fund recently launched by Axis Mutual fund, one of the premier asset management firm. The NFO of this fund is open through November 18th to December 2nd, 2015. From December 14th onward it will reopen for ongoing subscription. The fund will invest in a balance mix of equity and debt instruments which aims to the investment option for the minors.
How to Secure Your Child’s Financial Future with Axis Children’s Gift Fund
The Axis child fund will serve the purpose of children’s higher education and marriage or other similar need. The child should be less than 18 years old to be eligible for this investment which will be in his/her name. The investment will be represented by his or her parents or legal guardian till he attains the age of 18. The grandparents or a close relative of the child can gift the fund to a minor child as a donor.
Axis Children’s Gift Fund Key Highlights
- Eligibility: The child must be below 18 years to avail this investment option. Parents / donors can gift the mutual fund units to a minor child.
- Type of Fund: This is an Equity oriented-Balanced fund where Equity and Equity derivatives allocation will be in the range of 40%-60%. That means Net Equity component will be limited to max 60%. Debt and Debt derivatives allocation will be in the range of 25%-55% whereas 5-15% will be in cash-futures arbitrage. .
- Lock in Period: Opting for Lock in period is optional. Fund units can be locked in till the child attains the age of 18 yrs.
- Exit Load: The exit load will be applicable if units are redeemed. Exit load will be as below from purchase of units:
- 3% for exit within one year
- 2% for exit within one to Two year
- 1% for exit within two-three years
- Taxation: The Axis Children’s Gift Fund will be treated as Equity fund as per current taxation laws but there will not be any long term capital gain tax.
- 80C Benefit: This Axis child fund will not have any 80C tax benefit as this is not ELSS scheme or offered by any insurance company.
- KYC compliance: KYC compliance of natural guardian is mandatory. Either parents, Grandparents or relative can invest in the name of a child. If the grandparent or relative of the child is investing on behalf of that child, then they need to be KYC compliant along with parent or Legal guardian.
- Dates to Remember: This is open ended fund which is available for initial subscription from Nov 18, 2015 to Dec 02, 2015. The Fund will reopen for subscription like any other MF scheme from 14th December onwards.
If you are worried about your child’s education expense, then monthly investment in the mutual fund in the form of SIPs is a better option. So Axis Children’s Gift Fund can be considered as one of the good long-term investment option to save for the child’s future needs.