'It May Make Me Sound Frugal': Radhika Gupta Shares Tips On Securing Child's Future With Madhavan. Watch

Radhika Gupta shared personal experiences to highlight the pressure modern parents face to meet societal expectations, such as buying expensive clothes and gifts for their children

Raising children in modern times comes with substantial financial commitments, requiring careful planning well before the child is born. This was the central theme of a recent fireside chat between Radhika Gupta, MD and CEO of Edelweiss Mutual Fund, and actor R. Madhavan. The conversation delved into the challenges and strategies of modern-day parenting, noting the importance of financial prudence.

Gupta shared personal experiences to highlight the pressure modern parents face to meet societal expectations, such as buying expensive clothes and gifts for their children. Speaking candidly, she recounted her decision to avoid purchasing branded shoes for her young child. "Certain kids' shoes cost Rs 2,000 to Rs 3,000 and become redundant in two to three months. I opted for a cheaper alternative. It may make me sound frugal, but I believe it was a practical choice," Gupta said.

The Need for a Comprehensive Life Plan

Gupta underscored the importance of early financial planning for parents. She advocated for a structured approach, covering expenses during key phases of a child's growth:

Early Years (0-5): High childcare costs.

Primary School Years (5-10): Rising education expenses, particularly for parents opting for international schools.

Senior School Years (10-18): Costs associated with extracurricular activities, tuition, and preparation for higher education.

"Parents should adopt a rolling five-year plan to account for recurring and anticipated expenses. This ensures financial stability and reduces stress as the child grows," Gupta explained.

The Rising Cost of Education

Both Gupta and Madhavan highlighted the escalating costs of providing quality education. Over the past decade, primary school fees have surged in urban and rural areas alike, with inflation in the education sector currently at 11-12 per cent — almost double the general consumer price inflation of 6 per cent. This steep increase means education costs could double every six to seven years, posing significant challenges for families.

Some parents, in a bid to provide the best for their children, are overspending on educational needs, further adding to financial strain.

Teaching Financial Literacy

Gupta also highlighted the importance of instilling financial literacy and responsible spending habits in children from an early age. Striking a balance between fulfilling a child's desires and avoiding indulgence is key, she noted.

"Parenting today involves more than just providing — it's about teaching children the value of money and making them financially aware," she concluded. This insightful discussion serves as a reminder of the financial challenges modern parents face and the importance of prudent planning to secure their child's future.