Children's Mutual Funds Soar: AUM Jumps 160% in 5 Years Amid Rising Investor Interest

• Children's mutual funds AUM surged 160% over five years, reaching ₹26,000 crore with 3.2 million folios.
• These solution-oriented funds feature a mandatory lock-in period, fostering discipline for long-term goals like education.
• Despite rapid growth, the category has limited schemes, with 78% of AUM concentrated in three large funds.
• Average 3-5 year CAGR returns range from 20-30%, but experts recommend a long-term view (5+ years) due to 10-12% education inflation.
• Children's MFs offer goal alignment and forced discipline, with popular options including SBI Magnum Children’s Fund.

Why It Matters: Children's mutual funds are gaining traction due to strong returns and disciplined long-term planning.