Tata Capital > Blog > Wealth Services > Guide to saving and investment plans for the girl child in India
28 October 2026
8 mins read
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Summary
A savings scheme for a girl child is a special savings plan dedicated to keeping daughters financially secure. It helps you build a corpus for your girl child’s future, such as higher education or marriage. You can opt for government-backed savings schemes or those offered by private institutions. The best investment plan for a girl child in India is the Sukanya Samriddhi Yojana (SSY). It is a government initiative focusing on wealth generation to secure the future of your girl child.
A savings scheme for a girl childis designed exclusively for young girls. It promotes early saving and often comes with guaranteed interest and tax benefits.
If your goal is to build a tax-efficient corpus for your daughter’s future goals, it is essential to choose the right savings and investment plan. These goals can include schooling, higher education, marriage, or other milestones. In India, there are several investment plans for a girl child, including government-backed schemes, Public Provident Fund (PPF), mutual funds, child insurance plans, and fixed deposits. Each option offers different returns, risks, tax benefits, flexibility, and investment horizons, making it difficult for you to choose the best scheme for a girl child.
This guide outlines the features, benefits, and limitations of popular investment options so you can choose the most suitable plan for your daughter’s long-term financial security.
When you start investing early, your investments have more time to benefit from compounding, in which returns earn additional returns over the years. Using the power of compounding, you can grow even small, regular investments into a significant corpus by the time your daughter reaches important milestones such as higher education or marriage. Moreover, if you begin early, you will need a lower monthly or annual contribution to reach your goal.
For example, if you make a Rs. 25,000 annual investment for a girl child, starting from her birth until she turns 18, you can build a sizeable corpus. The wealth generated and growth will depend on the actual returns earned. You can use the savings to cover future educational expenses without financial stress.
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India offers many savings and investment options to help you build a financial corpus for your daughter’s future. Some of these plans focus on safety and guaranteed returns, while others aim for higher long-term growth. To choose the best investment plan for a girl child in India, you will need to understand your goals, investment horizon, and risk appetite.
In the sections below, you will find details on the best schemes for a girl child in India, helping you understand safer, lower-risk options and growth-oriented investments with higher return potential.
Sukanya Samriddhi Yojana (SSY) is the government-backed flagship savings scheme for a girl child. It is often viewed as the best scheme for a girl child as it is risk-free and helps fulfill long-term goals. It offers attractive returns, strong tax benefits, and a structured investment period. The scheme matures exactly 21 years from the date of account opening. However, you need to make deposits only for the first 15 years. The government reviews the interest rate quarterly and revises it as needed.
| Interest rate | 8.2% p.a., as of June 16, 2026 (Q1 FY2026-27) |
| Tax benefit | Deductions of up to Rs. 1.5 lakh under Section 80C |
| Tax status | Exempt-Exempt-Exempt (EEE) – investment, interest, and maturity amounts are tax-free |
| Eligibility | The account must be opened before the girl turns 10. |
| Minimum deposit | Rs. 250 |
| Maximum deposit | Rs. 1.5 lakh per year |
| Deposit period | 15 years from account opening |
| Maturity | 21 years from account opening or at marriage after 18 years of age |
| Withdrawal | Partially, up to 50% at the age of 18 for higher education |
The Public Provident Fund (PPF) is another safe, government-backed savings scheme for a girl child. It currently offers around 7.1% annual interest (as of June 16, 2026). However, the interest rate is not fixed, and the government reviews it every quarter. Like SSY, PPF also enjoys EEE tax status. This means your investment, gains, and maturity amounts are tax-free.
You can open a PPF account in a child’s name under a guardian’s supervision. The deposits into PPF are also deductible under Section 80C. However, the total deductions for SSY and PPF investments can together be up to Rs. 1.5 lakh of the Section 80C limit. Thus, PPF is a good complement to SSY because it offers greater flexibility.
If you have a long investment horizon of 10 to 18 years, equity mutual funds through Systematic Investment Plans (SIPs) can be the best investment plan for your girl child in India. Their growth potential is higher than fixed-rate schemes such as SSY or PPF. However, they also carry market risks.
Under this category of savings scheme for a girl child, you can consider children’s funds, gift funds, or diversified equity mutual funds. But you must know that there are no guaranteed returns, and you may face ups and downs. You can adopt a balanced approach that uses SSY and PPF as a safe foundation, with mutual funds for long-term growth.
Most insurance companies offer child-focused plans, including child endowment plans, Unit-Linked Insurance Plans (ULIPs), and money-back policies. These products combine insurance and investment. However, before proceeding, you must understand the purposes of both. A child has no income to insure. Thus, your first priority must be having adequate term insurance for the earning parent.
Many bundled child plans may have higher premiums and lower return potential than buying term insurance separately and investing through SSY, PPF, or mutual funds. You must carefully compare costs, benefits, and returns before deciding which is the best policy for a girl child.
Fixed Deposits (FDs) and Recurring Deposits (RDs) are safe and predictable savings options offered by banks and post offices. They provide fixed returns and are the ideal choice if you prefer stability over growth. However, the interest earned on these deposits is taxable, which can reduce post-tax returns compared with tax-efficient options such as SSY and PPF.
FDs and RDs are best used for short-term goals or as a small, stable portion of your overall investment plan for your daughter.
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In addition to the Sukanya Samriddhi Yojana (SSY), there are several other government schemes designed to support the education, welfare, and financial security of girl children in India. SSY is a central government scheme available nationwide. However, many states offer their own programs with different eligibility conditions and benefits. Some examples are Ladli, Bhagyashree, Kanyashree, and Bhagyalakshmi schemes.
The rules of these savings schemes for a girl child can change over time. Therefore, you must check your state government’s official portal for the latest details.
Choosing the right plan for your daughter becomes easier when you match each investment to your daughter’s future goals, time horizon, and your risk appetite. The framework you can adopt is as follows:
The following table differentiates between the various savings schemes for a girl child to provide clarity:
| Option | Indicative returns | Risk level | Lock-in / Tenure | Tax treatment | Best-suited goal |
| Sukanya Samriddhi Yojana (SSY) | 8.2% p.a. | Very low | Deposits for 15 years; maturity at 21 years from account opening | EEE; eligible for Section 80C deduction up to Rs. 1.5 lakh | Higher education and long-term corpus creation |
| Public Provident Fund (PPF) | 7.1% p.a. | Very low | 15-year tenure | EEE; eligible for Section 80C deduction up to Rs. 1.5 lakh | Long-term savings with flexibility |
| Bank Fixed Deposit (FD) | Around 6% to 8% p.a. | Low | Typically 7 days to 10 years | 10 years Interest taxable; some tax-saving FDs qualify for Section 80C | Short- to medium-term goals |
| Recurring Deposit (RD) | Around 6% to 8% p.a. | Low | Usually 6 months to 10 years | Interest taxable | Disciplined savings for near-term goals |
| Equity Mutual Fund (SIP) | Around 10% to 14% p.a. (long-term historical range) | Moderate to high | No fixed lock-in (except certain schemes) | Capital gains tax applicable | Long-term goals such as higher education |
| Child ULIPs | Market-linked; no guaranteed return | Moderate | Typically 5-year lock-in; longer recommended | Tax benefits subject to prevailing tax rules | Combined investment and insurance needs |
The returns shown in this table are indicative and based on rates or historical performance available as of June 2026.
It is easier to build a financially secure future for your daughter when you start investing early and choose the right mix of investments. Most parents can consider the government-backed Sukanya Samriddhi Yojana (SSY) as it provides a strong, tax-efficient foundation. PPF and equity mutual funds are also good options as they help add flexibility and long-term growth. It is essential for the earning parent to have adequate term insurance to maintain financial protection. The interest rates, tax rules, and scheme features can change over time, and thus, it is advisable that you inquire before choosing an investment plan for a girl child.
For most parents, the Sukanya Samriddhi Yojana (SSY) is considered the best policy for a girl child. It offers government-backed safety, attractive interest rates, and tax benefits. Its long-term structure is designed specifically for girls.
The current interest rate for Sukanya Samriddhi Yojana (SSY), as of Q1 FY 2026-27 (April - June 2026), is 8.2% per annum. The government reviews the interest rate every quarter. It may be revised as needed depending on the existing market conditions.
Both SSY and mutual funds serve different purposes. SSY provides safety and tax benefits. On the other hand, equity mutual funds offer higher long-term growth potential with market risk. Many parents use SSY as a safe base and mutual funds for additional growth.
There is no single best policy for every family. You can try a combination of SSY for savings, mutual funds for growth, and adequate term insurance on the earning parent. It is often more effective than bundled child insurance plans. You must determine what’s suitable for you based on your goals, risk appetite, and time horizon.
Yes, you can open both SSY and PPF for your daughter after checking the specific rules. They are tax-efficient options and qualify for Section 80C deductions. However, you can only claim a total of Rs. 1.5 lakh as deductions from both together.
The main central scheme is the Sukanya Samriddhi Yojana (SSY). Several states also offer schemes such as Ladli, Bhagyashree, Kanyashree, and Bhagyalakshmi. The eligibility, benefits, and conditions vary by state and may change over time.
To estimate the future cost of education, consider inflation and work backward to calculate the required monthly or annual investment. The amount depends on your target course, time horizon, expected returns, and financial situation.
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