SIP for child education: how much to invest each month for college fees

Every parent does this sum at some point: what will college cost when my child is 18, and how will I pay for it? The fee you see today is not the fee you will pay. Courses get more expensive faster than most things you buy, and a number that feels manageable now can look frightening 15 years later.

The good news is that 15 years is also a long time for a SIP. This guide shows how to put a number on your child’s future fees, how much SIP for child education reaches it, and how to open and protect the fund. The calculator beside the guide follows along and switches to each part’s example.

How to plan for child education: start with the future fee

Begin with what the course costs today, then grow it by an education inflation rate for the years left.

Nobody publishes one official figure for this. Kotak Mutual Fund’s February 2026 note puts education inflation at about 10–12% a year, quoting studies and media reports, and a May 2026 report by 1 Finance found big-city private schools often raise fees 10–12% a year. The official consumer price index shows education inflation of only 3–6%, because it averages many kinds of schooling. We use 10% as an estimate; use a lower rate for government colleges and a higher one for private or overseas plans.

Worked out with our compound interest calculator, a course that costs ₹12 lakh today becomes:

Years to college	At 6% a year	At 8% a year	At 10% a year
10 years	₹21.5 lakh	₹25.9 lakh	₹31.1 lakh
15 years	₹28.8 lakh	₹38.1 lakh	₹50.1 lakh

So a ₹12 lakh engineering or design degree with hostel, 15 years away, is a goal of roughly ₹50 lakh.

How much SIP for child education?

Meet Anitha, a bank clerk in Tiruvannamalai. Her daughter is 3, and she wants ₹50 lakh ready when her daughter turns 18. With our SIP calculator in goal mode, at an expected 12% a year:

• SIP needed: about ₹9,909 a month for 15 years
• She puts in: about ₹17.8 lakh
• Gains: about ₹32.2 lakh

That is the power of a long runway: most of the fee is paid by compounding, not by Anitha. Waiting has a cost, though. Starting a year later needs about ₹11,457 a month for the same goal.

Mutual fund returns are not guaranteed, and past returns don’t promise future ones. Plan with a modest return and check the fund once a year.

Start small with a step-up SIP

₹9,909 may be too much right now. If Anitha raises her SIP by 10% every year, she can start at about ₹5,758 a month and still reach ₹50 lakh. She puts in more in total, about ₹22 lakh, but the early years are easier on a young family’s budget. Our step-up SIP guide explains how to set it up.

The best time to start a child’s education SIP is the year they are born. The second best is this year.

Starting late: when the child is already in school

If your child is 8, there are 10 years left. The same ₹12 lakh course may cost about ₹31.1 lakh by then, and reaching ₹31 lakh needs about ₹13,343 a month. The goal is smaller, but the SIP is bigger, because compounding has less time.

With 10 years or less, use less equity: a large-cap index fund or a balanced fund is calmer than mid and small caps. Try 10% instead of 12% in the calculator to see how much room you have.

SIP, Sukanya Samriddhi or PPF: which is best for child education?

Fixed-rate savings are safe but grow slower. At PPF’s 7.1% (India Post, October 2026), ₹50 lakh in 15 years needs about ₹15,546 a month, against ₹9,909 at an expected 12%.

Sukanya Samriddhi pays 8.2% (India Post, October 2026) and its interest is tax-free, but it is only for a girl under 10, takes at most ₹1.5 lakh a year, and allows only up to 50% for higher education from age 18 (or after Class 10). Many parents split the plan: a safe part in Sukanya Samriddhi or PPF, and a growth part in an equity SIP.

Equity fund gains held over a year are taxed at 12.5% above ₹1.25 lakh of gains a year. On Anitha’s plan, if she sold everything at once, the calculator shows about ₹46.1 lakh left after tax, so aim a little above the fee, or sell over two financial years.

How to open a SIP for a child

You have two simple choices.

1. In your own name, labelled in your app as “Daughter’s college”. This is the easiest to manage.
2. In the child’s name, with you as guardian. Since June 2023, SEBI allows the SIP to be paid from the child’s account, your account, or a joint account, but redemptions go only to the child’s verified bank account. You need the child’s birth certificate and your KYC.

Some funds are sold as children’s funds; they lock the money in for at least 5 years or until the child turns 18, whichever is earlier. A lock-in can help discipline, but an ordinary diversified fund works too.

Two to three years before the fees are due, move the money step by step into a debt fund or a deposit. A market fall in the final year should never decide whether your child can join a course.

Questions

Is SIP good for child education?

Yes, for goals 10 years or more away. A monthly SIP in a diversified equity fund has historically grown faster than education costs, though returns are never guaranteed. Shift to safer options as college gets close.

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

Work out the future fee first, then use a SIP calculator in goal mode. For example, ₹50 lakh in 15 years needs about ₹9,909 a month at an expected 12%. A 10% yearly step-up lowers the starting amount to about ₹5,758.

How do I open a SIP for my child?

Open it in your own name and label it, or in the child’s name with you as guardian. A SIP in the child’s name can be paid from your bank account since June 2023, but money comes out only to the child’s verified account.

Which SIP is best for child education?

No single fund suits everyone. For 15 years or more, many parents use a low-cost Nifty 50 index fund or a flexi-cap fund; for under 10 years, a balanced or large-cap fund. A SEBI-registered adviser can help with your case.

Is Sukanya Samriddhi better than a SIP?

It is safer and tax-free, and pays 8.2% (October 2026), but it is only for girls under 10 and allows only 50% for education at 18. A SIP can grow more but moves with the market. Using both is common.

How do I save for child education if I start late?

Raise the monthly amount, lower the equity share, and consider a step-up. With 10 years left, a ₹31 lakh goal needs about ₹13,343 a month at 12%. Also look at scholarships and education loans as part of the plan.