Goal-based investing means each investment has one purpose, one target amount and one date. For your child, that means three things: find out what education and marriage will cost in future, start a separate SIP for each, and move the money to safer funds as the date gets close.

Costs for both goals rise faster than most family incomes.

•      Education: Costs in India rise about 10-12% a year, while general inflation is about 5-6% (Kotak Mutual Fund).

•      Study abroad: The rupee fell from about ₹73 per US dollar in 2021 to about ₹95 in June 2026 (The PIE News). The same fee in dollars now costs far more in rupees.

•      Marriage: An average Indian family spends over ₹12 lakh on a wedding, more than three times its yearly income (IANS, citing Jefferies). Urban surveys report much higher figures, such as ₹36.5 lakh (Kotak Mutual Fund).

Without a separate fund, many families end up taking a personal loan or selling assets at the wrong time.

Take today’s cost and add inflation for every year until the goal. Here is an example for a child aged 3. Education starts in 15 years and marriage is planned in 20 years. The marriage cost is only an assumption, so use your own figure.

Illustration only. Actual inflation will differ.

A family that saves only ₹45 lakh, because that is today’s cost, will fall short by more than half.

•      More than 5 years left: Equity funds. They go up and down in the short term but have time to grow and beat inflation.

•      3 to 5 years left: Hybrid funds, which mix equity and debt for a smoother ride.

•      Less than 3 years left: Debt or liquid funds, so a market fall does not damage the money you have built.

Move money from equity to debt in stages as the goal gets closer. A Systematic Transfer Plan (STP) can do this automatically. Read how it works in our guide on lump sum vs STP.

This table shows the SIP needed for the two goals above, assuming 12% a year. The last column starts lower and increases the SIP by 10% each year, as your income grows.

Illustration only. Equity returns are not guaranteed and can be negative in the short term. Try your own numbers on our SIP calculators.

Two things to notice:

•      Starting early saves a lot. The education SIP is ₹20,697 with 15 years left, ₹32,407 with 12 years left and ₹44,948 with 10 years left.

•      Savings accounts and FDs fall short. That same ₹20,697 SIP grows to about ₹63 lakh at 6.5% a year, against ₹1.04 crore at 12%. Equity carries more risk, but a low-return option cannot reach this goal.

See how much SIP you need for ₹1 crore for more on starting age.

Name each SIP, for example Education 2041 and Marriage 2046. You can then see if each goal is on track, and you are less tempted to spend the money elsewhere. If your child is a minor, the folio is opened in the child’s name with a parent as guardian. Our guide to a mutual fund for a minor explains the documents and steps.

A 15 to 20-year SIP only works if it keeps running. Before you start, make sure you have term life insurance, health insurance for the family, and an emergency fund of three to six months’ expenses. Otherwise a medical bill or job loss can force you to withdraw the child’s money. See term insurance vs health insurance for how the two differ.

Budget 2026 did not change mutual fund tax rules for FY 2026-27 (Outlook Money). Equity fund gains are taxed at 20% if you sell within 12 months. After 12 months, the tax is 12.5% on gains above ₹1.25 lakh in a year. Debt funds bought after 1 April 2023 are taxed at your income tax slab rate. Gains in a minor’s folio are generally added to a parent’s income. Our guide on debt fund taxation has examples. Please check with a tax adviser for your case.

Yes. In September 2026, monthly SIP contributions hit a record ₹32,490 crore, and 10.06 crore SIP accounts were active (AMFI data; Kotak Neo). Industry assets fell about 5% that month, yet SIP money kept rising. Investors who continue SIPs in a falling market buy more units for the same amount. See what to do when the Nifty is at a 52-week low.

•      Using today’s cost as the target.

•      Putting all goals into one portfolio.

•      Staying fully in equity until the last year.

•      Stopping SIPs when markets fall. Our article on the mutual fund behaviour gap shows how this costs investors returns.

More in 8 mutual fund mistakes Indian investors make.

How much should I invest monthly for my child’s education?

For a ₹25 lakh course that starts in 15 years, the future cost is about ₹1.04 crore. At an assumed 12% return, you need about ₹20,700 a month, or about ₹12,000 a month if you increase the SIP by 10% every year. Use our SIP calculators for your own figures.

Which mutual fund is best for a child’s education?

No single fund suits everyone. Long goals usually use equity funds, medium goals use hybrid funds, and goals under 3 years use debt or liquid funds. Check the fund’s Riskometer against your risk comfort.

Should education and marriage have separate SIPs?

Yes. The dates and amounts differ, so each needs its own plan, and separate SIPs stop you from using one goal’s money for the other.

What is education inflation?

It is how fast education costs rise. In India it is estimated at 10–12% a year, against 5–6% for general inflation (Kotak Mutual Fund).

Can I start a SIP in my child’s name?

Yes. A parent or guardian can open a folio for a minor and run a SIP. See our minor mutual fund guide.

Are mutual fund returns guaranteed?

No. Returns can be negative in the short term. The return figures in this article are assumptions to show the maths, not forecasts.

How do I check that a distributor is registered?

Ask for the AMFI Registration Number (ARN) and verify it on the AMFI and SEBI websites. Our ARN is 332811.