Finance

This Raksha Bandhan, Gift Your Sister Financial Freedom

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By CNBCTV18.com  IST (Published)

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There are a number of top financial products that can make a great festival gift for a sister and make them feel more secured and financially stronger.

One of the best gifts a brother can gift his sister on Raksha Bandhan is financial freedom. There are a number of top financial products that can make a great festival gift for a sister and make them feel more secured and financially stronger.

Simple ways such as contributing to an aspiration fund she has been saving for or even opening a savings account for her can take a step closer towards her financial security and independence, something that lasts forever.

Here’s a look at some of the best financial gifts for your sister:

If your sister does not have a bank account, you can open a savings account for her and deposit the money you wish to give her. The amount deposited in the account will earn interest and she can use this money when she needs it.

Fixed Deposit (FD) or Recurring Deposit (RD)

Alternatively, you can fix the amount you plan to give your sister or open a recurring deposit account and make small payments every month for a certain period. A fixed deposit account earns higher interest rate than a savings account.

Apart from traditional financial instruments, mutual funds are a great investment option. You can pick a mutual fund for your sister that has performed well in the last five years and invest in it if she is not an existing investor. It is best to choose a fund with a balance of equity and debt. If you choose an open-ended fund with no lock-in period, your sister will be able to redeem the amount as per her needs.

As a brother, you can invest in gold for your sister this year as a Raksha Bandhan gift. For those who do not prefer to buy jewellery can opt for paper gold instruments like gold ETF, mutual funds or sovereign gold bonds. Buying paper gold is different from buying gold in the physical form as an investment in paper gold does not attract costs of making charges which can go up to 25 percent of the price.

Gold ETF is an instrument that represents ownership of gold assets. However, if you are planning to gift your sister gold ETF, you need to ensure that she has a DEMAT and trading account. Apart from this, Sovereign Gold Bond and gold mutual funds are also options.

Gift her medical insurance

You can also buy your sister a health insurance plan that will ensure financial safety in times of medical emergencies. A health insurance policy will help your sister get medical treatment without worries about medical bills.

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