Best Performing Children’s Investment Funds in India: Detailed Comparison, Pros & Cons, Tax Implications, and Exit Loads

Best Children’s Investment Funds in India 2025 | Detailed Comparison & High Returns

Explore the top children’s investment funds in India for 2025. Compare SBI Magnum, HDFC Children’s Fund, Axis Children’s Fund, and more. Understand their performance, benefits, tax implications, and exit loads to make informed decisions for your child’s future.

Introduction

Investing in your child’s future is a priority for every parent. With numerous children’s investment funds available in India, choosing the right one can be daunting. This comprehensive guide compares the best-performing children’s funds in 2025, analyzing their performance, benefits, tax implications, and exit loads to help you make an informed decision.

Compare top children’s investment funds in India for 2025 like SBI Magnum, HDFC, Axis, LIC, and Sukanya Samriddhi. Learn about returns, lock-in, tax benefits, and the best SIP plans to invest in your child’s future.

Top Children’s Investment Funds in India (2025)

1. SBI Magnum Children’s Benefit Fund – Investment Plan

• Type: Hybrid – Aggressive

• Assets Under Management (AUM): ₹3,226 Crores

• Expense Ratio: 1.0%

• Returns:

  • 1 Year: 15.3%

  • 3 Years: 20.5%

• Lock-in Period: 5 Years

• Taxation:

  • Long-Term Capital Gains (LTCG) taxed at 12.5% for gains above ₹1.25 lakh after 1 year.

• Exit Load:

  • 3% if redeemed within 1 year

  • 2% if redeemed after 1 year but within 2 years

  • 1% if redeemed after 2 years but within 3 years

• Pros:

  • High returns over 3 years

  • Lower expense ratio

• Cons:

  • Mandatory 5-year lock-in period

2. SBI Magnum Children’s Benefit Fund – Savings Plan

• Type: Hybrid – Conservative

• AUM: ₹123 Crores

• Expense Ratio: 0.8%

• Returns:

  • 1 Year: 13.5%

  • 3 Years: 12.5%

  • 5 Years: 15.2%

• Asset Allocation: 19.63% equities, 62.14% debt, 18.23% others

• Pros:

  • Lower risk due to higher debt allocation

  • Suitable for conservative investors

• Cons:

  • Lower returns compared to aggressive plans

3. HDFC Children’s Gift Fund

• Type: Hybrid – Aggressive

• AUM: ₹9,590 Crores

• Expense Ratio: 0.9%

• Returns:

  • 1 Year: 6.3%

  • 3 Years: 16.9%

  • 5 Years: 22.4%

• Asset Allocation: 64.05% equities, 33.12% debt, 2.83% others

• Pros:

  • Strong long-term performance

  • Balanced asset allocation

• Cons:

  • Lower 1-year returns

4. Axis Children’s Gift Fund

• Type: Hybrid – Aggressive

• AUM: ₹868.75 Crores

• Returns:

  • 1 Year: 14.12%

  • 3 Years: 34.27%

  • Since Inception: 153.90%

• Pros:

  • Exceptional 3-year performance

  • No lock-in option available

• Cons:

  • Higher volatility due to aggressive strategy

5. Aditya Birla Sun Life Bal Bhavishya Yojna

• Type: Equity

• AUM: ₹1,031.92 Crores

• Returns:

  • 1 Year: 30.41%

  • 3 Years: 46.42%

  • Since Inception: 91.61%

• Pros:

  • High equity exposure leading to superior returns

• Cons:

  • Higher risk due to full equity allocation

6. LIC MF Children’s Fund

• Type: Hybrid

• AUM: ₹16.10 Crores

• Returns:

  • 1 Year: 23.07%

  • 3 Years: 44.41%

  • Since Inception: 213.45%

• Pros:

  • Consistent performance

  • Backed by LIC’s credibility

• Cons:

  • Smaller fund size

7. ICICI Prudential Child Care Fund (Gift Plan)

• Type: Hybrid – Aggressive

• AUM: ₹1,299.79 Crores

• Returns:

  • 1 Year: 7.15%

  • 3 Years: 17.79%

• Pros:

  • Balanced performance

  • Reputable fund house

• Cons:

  • Moderate returns compared to peers

8. Sukanya Samriddhi Yojana (SSY)

• Type: Government-backed Savings Scheme

• Interest Rate: 7.6% (as of 2025)

• Tax Benefits:

  • EEE (Exempt-Exempt-Exempt) status

  • Contributions eligible for deduction under Section 80C

• Lock-in Period: Until the girl child turns 21

• Pros:

  • Guaranteed returns

  • Tax-free maturity

• Cons:

  • Only for girl children

  • Limited flexibility and lower returns compared to mutual funds

Comparative Analysis

Selecting the right children’s investment fund depends on your risk appetite, investment horizon, and financial goals. For conservative investors, SBI Magnum Children’s Benefit Fund – Savings Plan and Sukanya Samriddhi Yojana offer stability and tax benefits. For those seeking higher returns and willing to accept higher risk, Aditya Birla Sun Life Bal Bhavishya Yojna and Axis Children’s Gift Fund are compelling options.

Always consider consulting with a financial advisor to tailor investments to your specific needs.